Homeownership Loans

A DSHA mortgage is a 30-year, fixed-rate loan with interest rates at or below the standard market rate for qualified buyers. That means you get a better deal! Our loans work through standard mortgage programs, including conventional, VA, FHA and USDA mortgages. And it doesn’t matter if you’re buying for the first time or have owned a house before.

Smart Start Home Loan: A first mortgage loan formally known as “DSHA unassisted”. Interest rates will be priced daily and will be at or below current market rates. Program available for conventional and government loans.


  • Maximum household income must be at or below the following limits:
    • New Castle County
      • 1-2 people: $137,280
      • 3 or more people: $171,600
    • Kent & Sussex County
      • 1-2 people: $117,240
      • 3 or more people: $146,550
  • Minimum credit score of 620. (Applicants with credit scores of 659 or below must participate in housing counseling.)
  • Maximum Sales Price:
    • New Castle County: $539,250
    • Kent & Sussex County: $481,176

DSHA also offers down payment and closing cost assistance as well as a First-Time Homebuyer Tax Credit. Scroll for more info on those programs!

If you’re ready to get started in the homebuying process, reach out to one of the participating lenders and let them know you’re interested in using DSHA’s programs to buy a home.


Homeownership Loans

DSHA First State Home Loan:
This is a zero-interest 2nd loan. Formerly known as “Preferred Plus,” which will provide a 4% down payment and closing cost assistance based off the final loan amount. The principal will be deferred until the following events: refinance, sales, transfer of title, the property is no longer the borrower(s) primary residence (whichever comes first).

For First-Time Homebuyers

Delaware has a special tax credit for first-time homebuyers that can help make your home more affordable. You can claim part of the annual interest paid on your mortgage (35% of the interest) as a special federal tax credit, up to $2,000 a year. The credit simply reduces your federal tax owed – a dollar-for-dollar savings! And you can use the tax credit along with our down payment and closing cost program. Just apply through one of our participating lenders.

Here’s how it works. If you borrow $150,000 at a 3.75% interest rate, you will pay about $5,625 in mortgage interest in the first year. With the tax credit, you can reduce your federal income tax liability by $1,968 for the year.

See below for eligibility requirements, additional property qualifications and targeted areas for the Delaware First-Time Homebuyer Tax Credit.

If you are a first-time homebuyer, when you reach out to a participating lender, let them know you are interested in using DSHA’s homeownership programs and taking advantage of the First-Time Homebuyer Tax Credit. You must use a DSHA participating lender in order to take advantage of the tax credit.

Eligibility Requirements for the First-Time Homebuyer Tax Credit:

  • Buyer must purchase a home within the State of Delaware.
  • Buyer(s) cannot have owned a home in the past three years as his or her primary residence unless purchasing a home in a Targeted Area or the homebuyer is utilizing the Qualified Veteran Exemption.
  • Household income and the purchase price must not exceed the maximum limits set by the Program.
  • Buyer must occupy the home as his or her primary residence.
  • Buyer must complete all tax credit documents at time of closing.

Maximum household income for eligibility is as follows:

CountyArea1 or 2 Person Households3 or More Person Households
New Castle CountyNon Targeted Areas$111,600$128,340
Targeted Areas$133,340$156,240
Kent & Sussex CountiesNon Targeted Areas$97,700$117,240
Targeted Areas$112,355$136,700

Property Qualifications for Delaware First-Time Homebuyer Tax Credit

To qualify for the Delaware First-Time Homebuyer Tax Credit, a property’s purchase price cannot exceed the below limits for each county.

County1 Unit2 Unit3 Unit4 Unit
New Castle$396,527$463,733$560,574$696,656

Targeted Areas
Income limits and purchase price limits are higher for homes purchased in targeted areas. The first-time homebuyer requirement is also waived, allowing repeat buyers who purchase a primary residence in a targeted area to apply for the Delaware First-Time Homebuyer Tax Credit. Check if the property you want to purchase is located in a targeted area by clicking on the links below.


Homebuyers who meet the above requirements can apply for the First-Time Homebuyer Tax Credit by contacting a participating lender.