Montgomery County just brought back one of the most generous home-buying programs in the entire state. The McHAF program — officially relaunched on August 17, 2026 — gives first-time buyers up to $25,000 toward a down payment and closing costs. The best part? You never write a single check to pay it back. If you stay in the home for 10 years, the money is completely forgiven. With only $2 million in the pool and funds handed out first-come, first-served, this round could be gone in about six months — just like the last one. Keep reading to learn exactly how it works, who qualifies, and how to make your move before the money runs out.
What Is McHAF and How Does the Forgiveness Work?
McHAF stands for Montgomery County Homeownership Assistance Fund. Technically it is structured as a 0% loan — but here is why that label should not scare you. There are no monthly payments, and the balance forgives itself at a rate of 1/120th every single month you live in the home. Do the math: after 120 months (10 years), nothing is left. The loan has literally melted away. As long as you stay in the house and keep it as your primary residence, you owe nothing when that decade is up.
Think of it less like a loan and more like a reward for putting down roots in Montgomery County.
The Backwards 40%-of-Income Formula
Most assistance programs give everyone the same flat amount. McHAF does it differently — and in a way that actually rewards higher earners. The program uses a 40%-of-income formula. That means the more you earn (up to the income limits), the larger your assistance amount can be, up to the $25,000 cap. If you have a solid income, do not assume you will get less help. You might actually qualify for the full amount.
High Income Limits — More People Qualify Than You Think
One of the biggest surprises about McHAF is how far up the income ladder the eligibility goes. The program covers:
- Single buyers: up to $119,532 in annual income
- Families: up to $199,220 in annual income
These are generous limits for a county where housing costs are high. Dual-income households that assume they earn too much to qualify should definitely double-check. A couple each making a solid middle-class income could still fall well within range.
The $0-Out-of-Pocket Play on a $500,000 Home
Here is where things get really exciting for buyers who feel like they cannot afford to get started. The video walks through a real example using a $500,000 home. By combining the McHAF $25,000 with a seller credit to cover closing costs, a buyer can potentially get to the closing table spending $0 out of pocket. This is not a loophole — it is smart use of the tools available to you. A good buyer's agent knows how to negotiate seller credits into the contract alongside your down payment assistance.
Who Qualifies — The Basic Checklist
McHAF has several requirements you need to meet. Here is what the program description lays out:
- You must be a first-time home buyer
- You need a minimum 640 credit score
- Your income must fall under the program limits ($119,532 single / $199,220 family)
- You must use an HOC participating lender (more on that below)
- The home must be in Montgomery County, Maryland and your primary residence
The 640 credit floor is worth noting. If your score is below that right now, it is worth talking to a lender about a plan to get there before the funds are gone.
The Catch: HOC's Mortgage Purchase Program and the Reservation Race
Every program has a catch, and McHAF's is important to understand. You cannot use just any lender. You must finance your home through HOC's Mortgage Purchase Program and work with one of HOC's approved participating lenders. That limits your options, so you will want to connect with a participating lender early in your search — not after you have already fallen in love with a house.
There is also a timing catch. Your McHAF funds are not reserved until after you have a ratified contract — meaning a signed purchase agreement. The pool is first-come, first-served. So the order of moves matters: get pre-approved with an HOC participating lender, find your home, go under contract, then get your funds reserved. Dragging your feet between any of those steps could mean the money is gone by the time you are ready.
With only $2 million available and the last round lasting about six months, urgency is real.
Extra $10,000 If You Work in Montgomery County
There is a bonus layer to know about. If you work in Montgomery County, you may be eligible for an additional $10,000 through what the video calls the "5 for 5" loan. That would bring your total assistance potential even higher. If your job is located in the county, ask your lender specifically about this add-on when you apply.
Frequently Asked Questions
Do I ever have to pay the $25,000 back?
Not if you stay in the home for 10 years. The balance forgives at 1/120th per month, so after 120 months it is completely gone. No payment, no balloon, nothing owed.
What credit score do I need for McHAF?
You need at least a 640 credit score to qualify for the program.
Can I use any lender I want?
No. McHAF requires you to finance through HOC's Mortgage Purchase Program with an HOC participating lender. You can find the approved lender list on the HOC website.
How quickly could the money run out?
The last round of McHAF lasted about six months before funds were exhausted. The current pool is $2 million, distributed first-come, first-served. Acting quickly once you are pre-approved is important.
Ready to See If You Qualify?
McHAF is one of the strongest down payment assistance programs available to Montgomery County buyers right now — and the clock is already running on that $2 million pool. The best next step is finding out exactly where you stand before someone else claims those funds. See which Maryland programs you qualify for and get matched with the right resources for your situation. You can also call or text Ronnie directly at (301) 835-1810, or email Listwithronnie@gmail.com for a free consultation.
This article is for education only and is not financial or legal advice. Program details change; verify with the program administrator. Not affiliated with any government agency or the Maryland Mortgage Program.