Downpayment Toward Equity Act of 2025

The Downpayment Toward Equity Act of 2025 would create a new federal program, run by the Department of Housing and Urban Development (HUD), to provide downpayment and related homebuying assistance to first-generation homebuyers. The goal is to address multigenerational inequities in homeownership and narrow, with the aim of closing, the racial homeownership gap. The program would disburse a total of $100 billion in grants to states (via their housing finance agencies) and eligible nonprofit or government entities, with 75% of funds allocated to states and 25% allocated competitively to eligible entities. Funds may be used for down payments, closing costs, rate-reduction subsidies, shared-equity affordability, and disability-related home modifications, and the program includes counseling requirements, data reporting, and a framework for accountability and fairness. Qualified buyers would need to meet income limits, be first-time buyers, and attest to being first-generation as defined by the bill (for example, parents/guardians and spouses/partners with no recent ownership in a residence). Eligible homes are modest, owner-occupied residences (1-4 units), and eligible mortgages include standard government-backed or insured loans and other qualifying loan programs. The act also imposes a repayment obligation if the buyer stops occupying the home within five years, with forgiveness after five years and certain hardship exceptions. The bill places emphasis on fair housing, reporting, privacy protections, and program uniformity, and it authorizes a substantial federal investment to support these goals.