TL;DR
Montgomery County offers two specific down payment assistance programs — the Montgomery Homeownership Program (up to $50K) and MEDPAL for county employees (up to $50K) — both at zero percent interest with deferred repayment. Income limits apply ($196,680 for 1–2 person households in 2026). You’ll need an MMP-approved lender and a homebuyer education class to access either program.
What Down Payment Assistance Is Actually Available to First-Time Buyers in Montgomery County, Maryland?
Montgomery County, Maryland has two dedicated down payment assistance programs through the Maryland Mortgage Program (MMP): the Montgomery Homeownership Program (MHP), available to any eligible buyer purchasing in Montgomery County, and MEDPAL, available exclusively to qualifying Montgomery County government employees. Both programs offer up to $50,000 as a zero-percent, deferred second mortgage — meaning no monthly payments and no interest while you own the home.
By Pey Behin | May 7, 2026
Most buyers in Bethesda and Montgomery County are leaving money on the table. Not because they’re careless — because nobody told them it existed.
The Maryland Mortgage Program has county-specific products for Montgomery County that most buyers never hear about until after they’ve already closed. If you’re buying in Bethesda, Chevy Chase, Potomac, North Bethesda, or anywhere in Montgomery County for the first time, here’s what you actually need to know before you make an offer.
The Two Montgomery County Programs Worth Knowing
Montgomery Homeownership Program (MHP)
This is the broadest option. Any MMP-eligible first-time buyer purchasing in Montgomery County can access it — not just government workers, not just low-income buyers.
- Up to $50,000 in down payment and closing cost assistance, structured as a zero-percent second mortgage
- Capped at 40% of the household income of the qualifying borrowers — on $120,000 household income, max assistance is $48,000
- Zero percent interest rate — no interest accrues while you live in the home
- Deferred repayment — due at sale, refinance, transfer, or 30 years, whichever comes first
- Any unused funds are applied to principal reduction, not returned as cash
In a market where Bethesda homes routinely sell between $700,000 and $2 million, a $40,000–$50,000 assistance loan can be the difference between getting into the market this year and waiting another two years to save.
MEDPAL (Montgomery Employee Down Payment Assistance Loan)
If you work for Montgomery County government, this is a stronger version of the same concept.
- Up to $50,000 as a zero-percent second mortgage
- Repayment required if you sell, transfer, or refinance — but the loan is forgiven at the 30-year mark if neither happens
- You must contribute at least 1% of the purchase price from your own funds
- Eligibility is limited to approved Montgomery County employees per the MEDPAL fact sheet
If you’re a career Montgomery County employee buying your long-term home, there’s a real path to $50,000 in assistance that eventually disappears from your balance sheet entirely.
Who Qualifies as a “First-Time Buyer” Under Maryland’s Rules
Maryland’s definition is more flexible than most buyers expect. You qualify as a first-time homebuyer if you have not owned residential property in the last three years.
For Montgomery County income eligibility in 2026:
- 1–2 person households: $196,680
- 3+ person households: $229,460
A dual-income household earning $180,000 combined would still qualify. These limits cover a significant portion of buyers in the county. (And if you’re still sizing up the full cost of ownership in Montgomery County, this breakdown of what buyers often miss on property taxes is worth a read.)
What You Need to Use These Programs
1. Work with an MMP-approved lender. Not every lender in Montgomery County participates. Find an approved MMP lender who can verify eligibility and confirm purchase price limits for your specific property location.
2. Complete a homebuyer education class. All borrowers must complete a Maryland-approved homebuyer education course before closing. Classes are available online and in-person throughout the state.
3. Check your purchase price limits early. Given the price points in Bethesda, Chevy Chase, and Potomac, not all properties will fall within program limits. Verify before you fall in love with a specific home.
How This Fits Into the Bethesda Market
On a $900,000 home, even a 5% conventional down payment is $45,000 — before closing costs in Montgomery County, which typically add another $15,000–$25,000. That’s a $60,000–$70,000 cash requirement before you start.
For buyers who are well-qualified on income but haven’t had years to accumulate that kind of savings — a relocating professional, a younger buyer carrying student loans, a renter who’s been waiting — the Maryland Mortgage Program changes the calculation. $50,000 at zero percent with no monthly payment is a substantial bridge.
Your specific number depends on your income, the property, and which program you qualify for. That’s where a conversation with both an MMP lender and a local agent who knows this market comes in.
What the Program Doesn’t Cover
- These are not grants — the money is repaid when you sell or refinance
- The $50,000 is a ceiling, not a guarantee — actual assistance is income-dependent
- Purchase price limits apply — not every Montgomery County property qualifies
- Good credit, stable employment, and a qualifying DTI are still required
One Thing Most People Don’t Check: The Rate
Here’s something that often gets overlooked: MMP first mortgages sometimes carry a slightly higher interest rate than what you’d get on a conventional loan in the open market. The down payment assistance is real — but it’s attached to a specific loan product, and that product’s rate may not be the lowest available to you.
That doesn’t mean the program is a bad deal. In many cases, the $40,000–$50,000 in assistance more than offsets a rate that’s a quarter or half point higher, especially if you’re planning to stay long-term. But it depends on your numbers, and it’s worth running the comparison.
Before you commit, get a quote from at least one lender outside the MMP system — a conventional loan with no assistance — and compare the total cost over the horizon you’re actually planning to own. Lower rate, no assistance vs. slightly higher rate, $50K upfront. Sometimes the assistance wins. Sometimes it doesn’t. You need your specific numbers to know.
This is exactly the kind of decision where talking to your agent and a couple of lenders pays off. If you don’t have lenders you trust, ask your agent — a good one will point you toward a few options. The goal is finding what’s actually right for your situation, not just what’s available.
Frequently Asked Questions
Can I use the Montgomery Homeownership Program if I’ve owned a home before?
No — MHP and MEDPAL are for first-time buyers defined as those who have not owned residential property in the last three years. If it’s been more than three years since you last owned, you likely qualify. Your lender will confirm.
Does the $50,000 assistance affect my ability to qualify for the first mortgage?
The second mortgage carries no interest and no monthly payment, so it generally doesn’t impact your debt-to-income ratio the way a standard second loan would. Ask your MMP-approved lender how the assistance will be treated in your qualification.
What if the home I want is over the MMP purchase price limit?
You’d proceed with standard financing. MMP limits keep the program focused on workforce buyers. Check the limits before you make an offer on a specific property.
How long does MMP approval take compared to a conventional mortgage?
The timeline is similar, but factor in the required homebuyer education class if you haven’t completed it. Start the process before you’re actively making offers.
If you’re buying in Montgomery County and haven’t explored what assistance is available, this is worth a 30-minute conversation with an MMP-approved lender before you start making offers. I work with buyers across Bethesda, Potomac, North Bethesda, and Chevy Chase — if you want to talk through how these programs fit your situation, reach out anytime.
About Pey Behin
Pey Behin is a residential real estate agent serving the Washington, DC metro area, with a focus on Bethesda, Montgomery County, and Northern Virginia. He works with buyers and sellers who want clear strategy, data-driven pricing, and direct guidance throughout the transaction process.
