Demystifying San Francisco's Down Payment Assistance Programs: Insights from the Legacy Real Estate Team 

San Francisco’s real estate market is notoriously competitive, but for first-time homebuyers, there are city-backed programs like DALP (Downpayment Assistance Loan Program), DreamKeeper, and Teacher Next Door that can help buyers get a foot in the door of their new home. 

These initiatives are designed to help more people put down roots in the city they serve. 

What is DALP, and who is it designed for in San Francisco?

DALP is a silent second loan program from the Mayor’s Office of Housing and Community Development (MOHCD). It provides down payment assistance to income-eligible first-time buyers purchasing a primary residence in San Francisco. The loan is repaid when the home is sold or refinanced. It’s designed for those who have not owned a residential property in the last three years, and whose household income does not exceed 200% of the Area Median Income.

What’s the difference between DALP and DreamKeeper?

DreamKeeper DALP (DK-DALP) is a specialized version of the DALP program focused on addressing racial equity. It provides enhanced access to funding for Black and African American first-time buyers in San Francisco. Like general DALP, it is a silent second loan, but it prioritizes applicants from historically underserved communities.

To help you understand how these programs work (and why sellers should embrace these buyers), we asked members of the Legacy Real Estate team to share their expertise.

"Why should sellers feel confident accepting offers from buyers using DALP or DreamKeeper?"

Jennifer Burden & Carren Shagley: "From our perspective, DALP and DreamKeeper buyers come to the table incredibly prepared. They’ve been vetted twice. First by their lender and then by the City. That kind of scrutiny makes them some of the most qualified buyers we see. Sellers might assume these offers are complicated, but in truth, they’re backed by well-supported financing and serious intent to close."

"What are some key eligibility requirements that first-time buyers should know before applying?"

Dulmaa Bor: "I like to break it down clearly for clients. You need to be a true first-time homebuyer, meaning no property ownership in the last three years. Your household income should be within the program’s AMI limits, and you’ll need to complete a 10-hour homebuyer education course. It’s also important to disclose all household members and their income, even if they won’t be on the loan. Transparency is key to getting approved."

"How does DALP affect the transaction timeline? What should listing agents and sellers expect?"

Cynthia Pagan: "Working with a DALP buyer is totally doable, but it helps to know the process. I’ve helped numerous DALP buyers cross the finish line and am a recommended agent on San Francisco’s DK-DALP sales agent list (view here). There’s extra paperwork because MOHCD has to review and approve everything. That can stretch closing to 45 or even 60 days. But when everyone’s informed and on the same page early on, the process is smooth. I always set expectations with the listing agent right up front."

"Why is this program a key pathway to building generational wealth?"

Judy Lin: "To me, it’s about access. DALP opens the door to homeownership for families who’ve been shut out by high prices. Once someone owns a home here, especially in San Francisco, they’re in a position to build equity fast. That equity becomes a foundation they can pass on. It’s not just about buying a house, it’s about changing a family’s financial future."

"Who qualifies for the Teacher Next Door program, and what does it offer?"

Jess Rucker: "Teacher Next Door is built for people who serve the city, teachers, first responders, public employees. I’ve worked with buyers who assumed they’d never afford a home in SF, but this program can help bridge that gap. It offers down payment assistance and sometimes other benefits like reduced closing costs. It’s a meaningful way to help our essential workers who give so much to this community stay in it."

"What’s your advice for buyers who feel overwhelmed by the application process?"

Jennifer Hughes: "It’s totally normal to feel overwhelmed at first. My advice is to breathe and take it one step at a time. The process has a lot of paperwork, yes, but so does any real estate transaction, and you don’t have to do it alone. A good agent and lender team can guide you through it. Once you start breaking it into parts, getting your documents together, completing the education, securing a pre-approval, it becomes manageable. And it’s worth it when you get the keys."

"What role does household income and liquid assets play in determining eligibility?"

Scott Conway: "This part trips up a lot of buyers. The Mayor’s Office of Housing and Community Development looks at total household income, not just whoever’s on the loan. That means if someone lives with you and earns income, it could affect your eligibility. Also, after closing, your liquid assets can’t exceed $80,000. That includes stocks, gifts, or retirement funds you’ve accessed. We always advise clients to be upfront early, so there are no surprises later in the process."

"Why do you believe programs like DALP, DreamKeeper, and Teacher Next Door are vital for San Francisco’s future?"

Jennifer Burden & Carren Shagley: "These programs are essential to keeping San Francisco inclusive and livable. They create paths to homeownership for the people who make this city special, teachers, artists, nurses, and longtime renters. Without support like DALP, too many families would never have a foothold here. We’re proud to be part of a solution that helps more people own a piece of this incredible City."

Ready to Learn More?

If you're a buyer wondering if you qualify or a seller with questions about DALP-backed offers, contact our team. We’re here to help you navigate the process with confidence.

DALP RESOURCE LIST

DALP - https://www.sf.gov/reports--december-2024--downpayment-assistance-loan-program-dalp

DALP Resource Guide (PDF) - https://media.api.sf.gov/documents/DALP_Manual_-_2025.pdf

DALP 2025 on our Blog - https://legacysfhomes.com/blog/understanding-san-franciscos-dalp-loan-assistance-program-a-2025-guide

Dream Keeper (DK-DALP) - https://www.sf.gov/reports--may-2023--dream-keeper-downpayment-assistance-loan-program-dk-dalp

Teacher Nextdoor® - https://www.teachernextdoor.us/San-Francisco