What down payment assistance is available in Howard County?
Not one program — five different loans
Howard County’s Settlement/Downpayment Loan Program (SDLP) is an umbrella, not a single product. Underneath it sit five distinct loans with different amounts, different income ceilings and different rules:
- HomeStarter Loan — up to $40,000
- HomeSteader Loan — up to $25,000
- DreamMaker Loan — up to $15,000
- Revitalization Loan — up to $25,000
- Workforce Initiative Loan — up to $4,300
Three require first-time homebuyer status. Two do not. The statewide Maryland Mortgage Program is available on top of all this.
Most articles about Howard County assistance flatten SDLP into “a county down payment program.” That framing costs buyers money, because the difference between qualifying for HomeStarter and qualifying for DreamMaker is $25,000 — and the difference between being told “you must be a first-time buyer” and knowing about the two loans that carry no such requirement can be the difference between buying and not.
The five SDLP loans compared
| Loan | Maximum | Income limit | First-time buyer? | Property location |
|---|---|---|---|---|
| HomeStarter | $40,000 | 80% of Baltimore metropolitan area median | Yes | Howard County |
| HomeSteader | $25,000 | 80% of Howard County median | Yes | Howard County |
| DreamMaker | $15,000 | 100% of Howard County median | Yes | Howard County |
| Revitalization | $25,000 | 110% of Howard County median | No | ZIP 21045 or 20723; property must be pending foreclosure or foreclosed |
| Workforce Initiative | $4,300 | 110% of Howard County median | No | Howard County |
The counter-intuitive part
HomeStarter has the lowest income ceiling and the largest loan. That is not a mistake — the program directs the most help to the households with the least income.
Note also that HomeStarter measures income against the Baltimore metropolitan area median, while the other four measure against the Howard County median. Howard County is a high-income jurisdiction, so its local median is higher. Two people with identical incomes can pass one test and fail the other.
Income limits
The county publishes the following maximum permitted incomes, effective 5/1/26. Limits are revised periodically, so treat these as current-as-published rather than permanent.
| Household size | HomeStarter 80% Baltimore region |
HomeSteader 80% Howard County |
DreamMaker 100% Howard County |
Revitalization & Workforce 110% Howard County |
|---|---|---|---|---|
| 1 | $74,800 | $82,310 | $102,888 | $113,177 |
| 2 | $85,450 | $94,068 | $117,585 | $129,344 |
| 3 | $96,150 | $105,827 | $132,284 | $145,512 |
| 4 | $106,800 | $117,586 | $146,982 | $161,680 |
| 5 | $115,350 | $126,992 | $158,740 | $174,614 |
| 6 | $123,900 | $136,399 | $170,499 | $187,549 |
| 7 | $132,450 | $145,806 | $182,258 | $200,484 |
| 8+ | $141,000 | $155,213 | $194,016 | $213,418 |
How the loans work
All SDLP loans are deferred — there are no monthly payments — and become due upon sale of the home, refinance, or default.
These are not zero percent loans
This is where Howard County differs from most Maryland assistance programs, and it is easy to miss.
SDLP loans carry interest at 2 percent below the primary mortgage interest rate, not to exceed 3%. The interest is deferred along with the principal, but it accrues. The exception is the Workforce Initiative Loan, which is 0%.
So when the loan comes due, you repay more than you borrowed. That is still an excellent rate on secondary financing — it is simply not free, and buyers who assume 0% because most programs are 0% will be surprised.
Forgiveness and other terms
| Loan | Term | Rate | Repayment |
|---|---|---|---|
| HomeStarter | Same as primary loan, at least 20 years | 2% below primary, max 3% | Deferred until resale, refinance or default. Partial forgiveness of principal and interest: 10% at 5 years, 20% at 10 years, 30% at 15 years as a principal residence. |
| HomeSteader | Same as primary loan, at least 20 years | 2% below primary, max 3% | Deferred until resale, refinance or default |
| DreamMaker | Same as primary loan, at least 20 years | 2% below primary, max 3% | Deferred until resale, refinance or default |
| Revitalization | At least 15 years | 2% below primary, max 3% | Deferred until resale, refinance or default |
| Workforce Initiative | 10 years | 0% | Deferred; principal reduced 10% per year for each year continuously employed full-time in Howard County over the loan term |
The Workforce Initiative Loan is small at $4,300, but it is the only one that can disappear entirely simply by continuing to work in the county — and it carries no first-time buyer requirement.
What the money can be used for
- HomeStarter: settlement costs, and down payment of up to 10% of the purchase price
- HomeSteader, DreamMaker and Revitalization: settlement costs, and down payment of 3.50% on FHA or up to 5% on conventional
- Workforce Initiative: recordation taxes
HomeStarter’s ability to cover up to 10% of the purchase price in down payment is unusually generous, and it is another reason the lowest income tier gets the strongest product.
Shared requirements
- Purchase price limit: the CDA purchase price limit for Howard County, currently $683,977
- Reserves: at least one monthly payment on the primary loan plus $1,000
- Your own money: a minimum of $1,000 toward settlement and down payment costs
- Need: you must lack sufficient funds to pay the total settlement and down payment costs yourself
- Assets: borrower assets above the required reserves must be used first
- Debt ratio: back ratio no greater than 45%
- First mortgage: must be approved for a fixed-rate primary mortgage loan
- Homebuyer education: must be completed prior to closing; all participants must take part in pre-purchase counseling
The fixed-rate requirement is not a formality
SDLP requires an approved fixed-rate primary mortgage. An adjustable-rate loan will not support these county seconds, no matter how attractive the initial rate looks.
Find out which Howard County loan you qualify for
The gap between HomeStarter and DreamMaker is $25,000, and the income tests use different medians. Getting the product right is the whole exercise.
This is not a commitment to lend. All loans subject to credit approval.
The statewide Maryland Mortgage Program
Howard County buyers can also use the Maryland Mortgage Program, the state’s homeownership loan program administered by the Department of Housing and Community Development. It pairs a below-market 30-year fixed first mortgage with its own down payment assistance options and is available in every Maryland county.
The Maryland Mortgage Program lists Howard County DHCD and the SDLP among the local down payment assistance partners in its statewide directory.
Whether they combine is a question for your lender
Howard County does not publish a blanket statement that SDLP may be layered onto Maryland Mortgage Program financing. Whether the two can be used together depends on the requirements of both programs and on your first mortgage.
What we can say is that SDLP requires a fixed-rate first mortgage, and the Maryland Mortgage Program’s first mortgages are 30-year fixed — so the structural requirement is at least compatible. Confirm the specific stack with an approved lender before relying on it.
How SDLP works with your mortgage
| Loan type | How it interacts with SDLP |
|---|---|
| FHA | Explicitly contemplated — several SDLP products define down payment coverage at FHA’s 3.50% requirement. A natural pairing. |
| VA | Qualified veterans can already finance without a down payment, so assistance tends toward settlement costs. Secondary financing follows VA rules and lender overlays, and the loan must still be fixed-rate for SDLP. |
| USDA | USDA is limited to eligible rural areas. Howard County is largely suburban, so eligibility must be checked address by address rather than assumed. |
| Conventional | Explicitly contemplated — SDLP defines conventional down payment coverage at up to 5%. The specific product and its mortgage insurance requirements govern what is permitted. |
Compare this with the wider picture of Maryland down payment assistance.
If you want to understand FHA financing before layering county assistance on top, our Maryland FHA loans guide covers it in detail.
How to apply
- Contact your primary mortgage lender for loan program information. You do not apply to the county directly — lenders submit all requests.
- Get approved for a fixed-rate first mortgage. SDLP packages are submitted after you have a contract on a home and primary mortgage approval.
- Complete homebuyer education prior to closing.
- Your lender reserves funds with DHCD once approved, and submits the complete package.
- Allow the lead time. A complete SDLP loan package must be submitted at least 9 business days prior to closing.
Funding is limited and not guaranteed
The county states plainly that availability of funds is limited and not guaranteed, and that funds are offered first-come, first-served. Reserving funds early through your lender matters.
Common mistakes
- Assuming SDLP is one program. It is five, and picking the right one is worth tens of thousands of dollars.
- Assuming you must be a first-time buyer. Revitalization and Workforce Initiative loans carry no first-time requirement.
- Assuming 0% interest. Only the Workforce Initiative Loan is 0%. The others accrue at up to 3%.
- Using an adjustable-rate first mortgage. SDLP requires fixed-rate primary financing.
- Comparing against the wrong median. HomeStarter uses the Baltimore region median; the others use Howard County’s.
- Submitting late. The package is due at least 9 business days before closing.
- Holding excess assets. Borrower assets above the required reserves must be used first.
Frequently asked questions
How much down payment assistance can I get in Howard County?
Between $4,300 and $40,000, depending on which of the five SDLP loans you qualify for. HomeStarter is the largest at $40,000 and carries the lowest income ceiling. Statewide Maryland Mortgage Program assistance may also be available.
Do I have to be a first-time homebuyer?
For HomeStarter, HomeSteader and DreamMaker, yes. The Revitalization Loan and the Workforce Initiative Loan do not carry a first-time homebuyer requirement.
Is SDLP interest-free?
Only the Workforce Initiative Loan. The other four accrue interest at 2 percent below your primary mortgage rate, capped at 3%. The interest is deferred along with the principal but is still owed.
Is any of it forgiven?
The HomeStarter Loan carries partial forgiveness of principal and interest — 10% at five years, 20% at ten years and 30% at fifteen years as a principal residence. The Workforce Initiative Loan reduces 10% per year for each year of continuous full-time employment in Howard County.
What is the purchase price limit?
The CDA purchase price limit for Howard County applies, currently $683,977. Limits are revised, so confirm the figure applicable when you buy.
What is the Revitalization Loan for?
It targets specific areas — ZIP codes 21045 or 20723 — and requires the property to be pending foreclosure or already foreclosed. It offers up to $25,000 and does not require first-time buyer status.
How do I apply?
Through your primary mortgage lender. Lenders submit all SDLP requests and reserve funds with the county; buyers do not apply directly. The complete package is due at least 9 business days before closing.
How much of my own money do I need?
A minimum of $1,000 toward settlement and down payment costs, plus reserves of at least one monthly payment on the primary loan. Assets above that must be applied to the purchase first.
Can I combine SDLP with the Maryland Mortgage Program?
The county does not publish a blanket statement either way, so we are not claiming it. SDLP does require a fixed-rate first mortgage, which is structurally compatible with MMP’s 30-year fixed products. Confirm the specific combination with an approved lender.
Can I use an adjustable-rate mortgage?
No. SDLP requires approval for a fixed-rate primary mortgage loan.
Sources
- Howard County Department of Housing and Community Development — Settlement/Downpayment Loan Program Information Packet, revision dated 5/1/2026: the five loan products and their maximum amounts, the income limit chart effective 5/1/26 by household size, the interest rate of 2 percent below the primary mortgage rate not to exceed 3%, the 0% Workforce Initiative rate, loan terms, deferred repayment on resale, refinance or default, the HomeStarter forgiveness schedule, the Workforce Initiative 10% annual principal reduction for continuous full-time Howard County employment, permitted uses of loan funds, the $683,977 CDA purchase price limit, the $1,000 minimum contribution and one-month PITI reserve requirement, the 45% back ratio, the fixed-rate primary mortgage requirement, the requirement to lack sufficient funds, the first-time homebuyer requirement applying to HomeStarter, HomeSteader and DreamMaker but not to Revitalization and Workforce Initiative, the Revitalization area restriction to ZIP codes 21045 and 20723 with foreclosure condition, the homebuyer education requirement prior to closing, lender submission process, the 9 business day submission deadline, and the statement that availability of funds is limited and not guaranteed.
- Howard County Department of Housing and Community Development — Settlement Downpayment Loan Program page: application process, lender fund reservation, and first-come, first-served availability.
- Maryland Mortgage Program — down payment assistance offered by location: listing of Howard County DHCD and the Howard County SDLP among local assistance partners.
- Maryland Department of Housing and Community Development — Maryland Mortgage Program structure, assistance options and approved lender requirement.
Verified September 2, 2026 against the packet revised 5/1/2026. Income limits change every January and July, purchase price limits are revised, and funding availability is limited and not guaranteed. Confirm current figures with Howard County DHCD and an approved lender before relying on anything here.
This page explains how down payment assistance in Howard County generally works. It does not determine individual eligibility, is not a commitment to lend, and is not a Loan Estimate. Program terms are set by Howard County and the Maryland Department of Housing and Community Development, and participating lenders may apply additional requirements. Maryland Homebuyer Hub is not affiliated with, endorsed by, or acting on behalf of Howard County or any government agency.