Montgomery County’s Office of Housing and Community Development lends first-time buyers up to 10% of the purchase price, capped at $10,000, at 0% interest. The county’s page calls it a grant. Read the application before you believe that word, because the money comes back if you leave.
The county program, and the clause that matters
The assistance is recorded as a second mortgage with a deed restriction filed straight after the deed. If within 15 years the house is sold, conveyed, transferred, vacated, abandoned as a primary residence or used as an investment property, the county recaptures 100% of the second mortgage. There is no declining schedule — nothing melts away at year five or year ten. After 15 years the obligation ends. If you stop living there during the term you have 30 days to tell the office in writing.
The money comes from the county’s Affordable Housing Trust Fund, in coordination with the Recorder of Deeds, and is first come, first served. Page last updated 2 June 2026; brochure May 2026.
The income ceiling is unusually generous, because the cap is set at median income, a full step above the 80% figure most programs use:
| Household | Income cap |
|---|---|
| 1 person | $85,900 |
| 2 people | $98,200 |
| 3 people | $110,500 |
| 4 or more | $122,700 |
Other conditions worth knowing before you spend an evening on the form. You either live in Montgomery County or work full-time in it. You put 3% of the sales price in from your own funds, with no gifts of cash or equity allowed toward that first 3%, and you show at least $3,000 in liquid assets at application. Having a lot saved works against you: the county says assistance is not available if you have 10% or more of the sales price to put toward the purchase. Counselling is mandatory, free, and has to happen before any contract of sale is executed. The property is a single-family home in the county, and it gets a Housing Quality Standards inspection. There is a $25 application fee.
The county publishes no purchase price cap and no list of participating lenders. Price is judged household by household against what the office calls program affordability, and any lender writing conventional, FHA or VA at or below market rate is acceptable.
The two municipal programs
Norristown has run a down payment and closing cost program since 1997 — roughly $5,000, calculated as no more than half the down payment the lender requires plus closing help, recorded as a 0% deferred second with no monthly payment and forgiven in full after five years. Norristown counts first-time as no primary residence owned in five years, stricter than the county’s three, and asks 3% of the sales price from the buyer. One caution: the last budget anyone can verify for it is FY2020, and the borough’s block grant is carrying a large repayment obligation. Call the Department of Planning and Municipal Development, 610-270-0451, before you build a plan on it.
Lower Merion does something different. The Lower Merion Affordable Housing Corporation buys or builds a specific house, sells it below market and bridges the gap with a 0% second mortgage that has no monthly payment. Half of that second is forgiven eventually — 25% at ten years, 25% at twenty — and the rest stays with the property. The household has to be two or more people, which is unique in this county, and applications and counselling go through Genesis Housing in Norristown, 610-275-4357.
Pottstown, Abington, Upper Merion and Lansdale run no homebuyer program of their own.
PHFA, for the buyer the county program does not fit
The Pennsylvania Housing Finance Agency’s Keystone Home Loan limits for Montgomery County, from Appendix A dated July 2026: purchase price $588,800, income $122,700 for a one or two person household and $141,100 for three or more.
K-FIT is the assistance loan with real forgiveness — 5% of the lesser of price or appraised value, no dollar cap, 0%, and 10% of it forgiven every year for ten years. Keystone Advantage is $6,000 at 0% but amortized over ten years, so it has a monthly payment. K-DATE defers entirely and comes due on sale, refinance or payoff. Above the Keystone income ceilings, Keystone Flex reaches the same K-DATE assistance with a $212,000 income limit and a $730,600 price limit, and does not require a first-time buyer at all.
All of this assistance rides on top of a first mortgage that is subject to lender approval, and none of these programs changes that decision. Montgomery County is a non-target county with two targeted census tracts, 2024.01 in Cheltenham Township and 2039.01 in Norristown. The limits there are identical; what changes is that the first-time buyer requirement is waived. Tracts do not follow municipal lines, so PHFA sends buyers to the FFIEC geocoder to check a specific address.
The dates nobody tells you at settlement
Apply for the homestead exclusion through the county assessment office. Act 1 school relief closes 1 March and Act 50 local relief closes 15 December; the county’s own advice is to mail by 15 December and be done with both. Close after 1 March and the school portion waits a year. What it is worth depends entirely on the district: 2025-26 relief ran from $149 per homestead in Upper Merion Area to $777 in Pottstown.
What to do next
Work out the township first, then the price, then which program the numbers actually reach. Call the line, or write it in the form and send it along, and a licensed Pennsylvania mortgage lender calls you back — usually the same working day, and by the end of the next working day at the outside. If you are anywhere near the county program, make that call before you sign anything, because the order of operations is the whole game.