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The Maryland Mortgage Program (MMP): Eligibility, Rates, and How to Apply in 2026

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The Maryland Mortgage Program (MMP): Eligibility, Rates, and How to Apply in 2026

Maryland Mortgage Program guide cover with Maryland state silhouette, golden key icon, and home illustration

The Maryland Mortgage Program (MMP) is a state-run home loan initiative from the Maryland Department of Housing and Community Development (DHCD). It pairs 30-year fixed mortgages with optional down payment and closing-cost assistance for eligible buyers purchasing primary residences in Maryland.

If you’re house-hunting from Towson to Annapolis, MMP is one of the biggest financial tools first-time buyers overlook. In 2024, Maryland’s median household income reached $108,200, the highest of any U.S. state (U.S. Census Bureau QuickFacts: Maryland, 2024). That high cost of living is exactly why MMP exists, and why its income ceilings sit far above typical state housing programs. At Next Step Realty, our agents work with MMP buyers across Baltimore County, Anne Arundel, Howard, and Harford. This guide walks through eligibility, 2026 income guidance, the DSELP down payment loan, county price caps, and the full application process.

Key Takeaways

  • MMP offers 30-year fixed mortgages plus up to $15,000 in DSELP down payment assistance for eligible Maryland buyers (Maryland DHCD MMP, 2026).
  • Income and price caps vary by county and household size, with higher ceilings inside DHCD-designated Targeted Areas.
  • MMP layers on top of FHA, VA, USDA, and conventional first mortgages.
  • An MMP-approved homebuyer education course and an MMP-approved lender are both mandatory.

New to the homebuying process? Start with our First-Time Homebuyer hub for the full Maryland-specific roadmap, or compare options on the financing overview.

What Is the Maryland Mortgage Program and Who Runs It?

In 2026, the Maryland Mortgage Program is administered by the Maryland Department of Housing and Community Development (DHCD), the state agency responsible for housing finance and community development since 1987 (Maryland DHCD, About DHCD, 2026). MMP is not a direct lender. It works through a network of DHCD-approved private lenders who originate and close the loans.

Here’s the part most buyers miss. MMP is a financing structure, not a single loan product. The first mortgage piece can be FHA, VA, USDA, or conventional, and DHCD layers its rate program and down payment assistance on top. Two MMP buyers on the same street can have very different loan stacks.

The program’s stated mission is to expand homeownership access for Marylanders by offering competitive fixed rates and down payment help. First-time buyers, public-sector employees, and households purchasing in designated Targeted Areas all sit at the center of the program. Repeat buyers can also qualify when they purchase inside a Targeted Area.

Citation capsule: The Maryland Mortgage Program is run by the Maryland Department of Housing and Community Development through DHCD-approved private lenders, layering 30-year fixed first mortgages with optional down payment assistance for eligible Maryland primary-residence buyers (Maryland DHCD MMP, 2026).

Who Qualifies for MMP in 2026?

Maryland’s 2024 median household income of $108,200 is the highest in the United States, which is a major reason MMP’s income windows run wider than most state housing programs (U.S. Census Bureau QuickFacts: Maryland, 2024). Eligibility hinges on four buckets: borrower status, household income, property type, and occupancy.

Borrower Requirements

  • Must be a first-time homebuyer (no ownership interest in a primary residence in the past 3 years), OR purchasing in a DHCD-designated Targeted Area, OR an eligible veteran using the first-time waiver.
  • Must meet the credit score floor of the chosen first-mortgage product (FHA, VA, USDA, or conventional) and any DHCD overlay set by the approved lender.
  • Must complete an MMP-approved homebuyer education course before closing.
  • Must occupy the property as a primary residence.

Income and Household Rules

MMP looks at total qualifying household income, not only the borrowers on the note. This is where multi-generational households in Prince George’s County and military families in Anne Arundel can get tripped up. Run the numbers with an MMP-approved loan officer before you assume you’re inside the limit.

Citation capsule: MMP eligibility in 2026 layers four tests: first-time-buyer status (or Targeted Area or veteran exception), an MMP-approved homebuyer education course, owner occupancy, and county-specific income limits published by DHCD (Maryland DHCD MMP, 2026).

What Are the 2026 MMP Income Limits by Household Size?

In 2024, Maryland’s $108,200 median household income led the nation, ahead of every other state in the Census QuickFacts dataset (U.S. Census Bureau QuickFacts: Maryland, 2024). MMP income limits are set county-by-county by DHCD and adjust for household size, with higher ceilings in Targeted Areas.

Because DHCD updates the income limit chart each program year, the only safe move is to pull the current figures directly from the official MMP site. The published limits chart on the program’s lender resources page is the source of truth.

Where to Find Current Limits

  • Official chart: published on the Maryland DHCD MMP site (mmp.maryland.gov).
  • Targeted vs Non-Targeted Areas: each county has different limits inside Targeted census tracts, which often allow significantly higher household incomes.
  • Household composition: count adults living in the home, not only the borrowers on the loan.

Don’t guess on income. We’ve watched buyers walk away from a perfect home because they assumed they were over the cap when they weren’t, or get to underwriting and discover an adult child’s income pushed them out. A 10-minute call with an MMP-approved lender resolves it.

Citation capsule: Maryland’s nation-leading $108,200 median household income (U.S. Census Bureau, 2024) is why MMP income ceilings sit higher than typical state housing programs. DHCD publishes county-specific limits on its MMP site and adjusts them for household size and Targeted Area status.

Which Properties Are Eligible and What Are the County Price Caps?

In 2026, MMP eligible properties must be primary residences located in Maryland, with maximum purchase price limits set per county and updated by DHCD on the official program website (Maryland DHCD MMP, 2026). Caps differ between Targeted and Non-Targeted Areas, with Targeted ceilings consistently higher.

Eligible Property Types

  • Single-family detached homes.
  • Townhomes and condominiums (the condo project must be approved by the first-mortgage investor, such as FHA, VA, or Fannie/Freddie).
  • Two-unit properties under program-specific seasoning rules, with the borrower occupying one unit.
  • Manufactured homes on permanent foundations under program-specific rules.

How Price Caps Actually Hit Buyers

For Maryland buyers shopping in the $250,000 to $500,000 range, the published MMP price caps comfortably cover most starter homes in Severna Park, Towson, and the suburbs around Baltimore. The caps tend to bind only on luxury condos in Annapolis and select Howard County listings.

Citation capsule: MMP requires a Maryland primary residence within the published per-county purchase price cap, with eligible types including single-family homes, approved condos, certain two-unit properties, and qualifying manufactured homes (Maryland DHCD MMP, 2026). Targeted Areas allow higher caps than Non-Targeted Areas.

How Does DSELP Down Payment Assistance Work?

The Down Payment and Settlement Expense Loan Program (DSELP) provides up to $15,000 in down payment and closing-cost assistance as a 0% deferred second lien for eligible MMP borrowers, per Maryland DHCD program guidelines (Maryland DHCD MMP, 2026). It’s the most-used component of the MMP stack.

DSELP Structure at a Glance

  • Amount: Up to $15,000 through DSELP. Partner Match programs from employers, builders, or community organizations can stack on top.
  • Interest rate: 0%.
  • Repayment: Deferred. No monthly payment. The full balance is due when you sell, refinance, transfer title, or pay off the first mortgage.
  • Forgivable? No. DSELP is not forgiven, but because it doesn’t accrue interest, long-term holders pay back the same dollar amount they borrowed.

Agent perspective: In our experience working with MMP buyers across Baltimore and Anne Arundel counties, DSELP is the deciding factor between buying now and waiting another year or two. Buyers who use the full $15,000 typically apply it to the FHA 3.5% down payment first, then closing costs, which is exactly how the program is designed to flow. (Qualitative observation from Next Step Realty agents, not a published DHCD statistic.)

Citation capsule: DSELP provides up to $15,000 as a 0% deferred second mortgage, repayable only on sale, refinance, title transfer, or payoff of the first mortgage (Maryland DHCD MMP, 2026). Partner Match programs can layer additional assistance on top of the DSELP base amount.

How Does MMP Stack With FHA, VA, and Conventional Loans?

In 2024, FHA-insured single-family loans served roughly 730,000 borrowers nationwide, and VA-guaranteed loans supported homeownership for hundreds of thousands more service members and veterans (HUD, Single Family Housing, 2024; VA Home Loans, 2024). MMP is engineered to layer cleanly on all of those products plus conventional.

The Three Most Common MMP Stacks

  1. MMP plus FHA (most common): 3.5% down with FHA-insured financing under HUD lender guidelines. DSELP often covers the full down payment for buyers in the $250,000 to $400,000 range.
  2. MMP plus VA: 0% down, no PMI, available to eligible service members, veterans, and surviving spouses per VA.gov eligibility rules. DSELP can fund closing costs and the VA funding fee.
  3. MMP plus Conventional: Typically Fannie Mae HFA Preferred or Freddie Mac HFA Advantage at 3% down, with reduced mortgage insurance compared to standard conventional pricing.

Which Stack Fits Which Buyer?

VA-eligible buyers near Annapolis and the Naval Academy almost always pair MMP with a VA first mortgage. Buyers with credit in the lower-mid range typically land on FHA, while higher-FICO buyers often win on the conventional HFA Preferred path because of lower long-term mortgage insurance costs.

Under-used option: The conventional HFA Preferred stack is the most overlooked MMP path in our market. Many lenders default-quote FHA because it’s familiar, but for higher-FICO buyers the HFA Preferred mortgage insurance structure can be meaningfully cheaper across a 7-to-10-year hold. Always ask your loan officer to quote both before locking.

Citation capsule: MMP layers on FHA, VA, USDA, and conventional first mortgages, with the conventional path typically using Fannie Mae HFA Preferred or Freddie Mac HFA Advantage products that carry reduced mortgage insurance for lower- to moderate-income borrowers (Maryland DHCD MMP, 2026).

How Do MMP Rates Compare to the National 30-Year Fixed?

As of early 2026, the Freddie Mac Primary Mortgage Market Survey publishes the weekly U.S. average rate on a 30-year fixed conforming loan, the standard benchmark mortgage professionals use to compare programs (Freddie Mac PMMS, 2026). MMP rates are set by DHCD on a published rate sheet and are positioned to be competitive with that benchmark.

Two structural reasons MMP rates can run below typical retail pricing:

  • DHCD funds the program through tax-exempt mortgage revenue bonds, which lowers its cost of capital.
  • The program is policy-driven rather than profit-maximizing, so spreads above DHCD’s funding cost are kept tight.

Exact spreads vary week to week and depend on which first-mortgage product you choose. The cleanest move is to ask your MMP-approved lender for the current DHCD rate sheet on the day you plan to lock, then compare it to the latest Freddie Mac PMMS reading.

Citation capsule: MMP first-mortgage rates are set on a DHCD rate sheet funded through tax-exempt mortgage revenue bonds, which can produce pricing competitive with or below the weekly national average tracked by the Freddie Mac Primary Mortgage Market Survey (Freddie Mac PMMS, 2026).

What Is the Step-by-Step MMP Application Process?

In 2026, applying for an MMP loan follows the same general path as any conventional or government mortgage, with two extra layers: the DSELP second lien and DHCD’s compliance review of program eligibility (Maryland DHCD MMP, 2026). Plan for slightly longer timelines than a non-MMP loan.

Step 1: Choose an MMP-Approved Lender

You can’t apply through DHCD directly. Pick from the lender list on mmp.maryland.gov. Local lenders who originate high MMP volume usually close faster and catch program-specific issues earlier than national banks who rarely touch MMP.

Step 2: Complete MMP-Approved Homebuyer Education

An MMP-approved homebuyer education course is mandatory before closing. Courses are offered online and in person by approved counseling agencies. Take it during week one of your search, not the week before settlement.

Step 3: Get Pre-Approved

Your lender pulls credit, verifies income against the applicable MMP household income limit, confirms first-time buyer status (or Targeted Area exception), and issues a pre-approval that explicitly references MMP. Use our buyer resources to organize documentation in advance.

Step 4: Find the Home and Submit an Offer

Confirm the property is in an eligible county, under the published price cap, and structurally eligible (single-family, approved condo, qualifying two-unit, or qualifying manufactured home). Your Next Step agent will flag these issues before you waste an inspection fee on a non-eligible property.

Step 5: Underwriting Plus DHCD Compliance Review

Two reviews happen in parallel: standard mortgage underwriting on the first mortgage, plus DHCD’s compliance review of MMP eligibility and the DSELP loan. The compliance review typically adds about a week to the timeline.

Step 6: Close and Move In

You’ll sign two notes at closing: the first mortgage and, if you’re using DSELP, the DSELP second. The DSELP note has no monthly payment, but it is a real recorded lien on title.

Citation capsule: MMP applications run through approved private lenders and require homebuyer education, lender pre-approval, an eligible property under the county price cap, parallel underwriting and DHCD compliance review, and two recorded notes at closing when DSELP is used (Maryland DHCD MMP, 2026).

What Are the Most Common MMP Mistakes and Disqualifications?

In 2026, most MMP denials and disqualifications cluster around a handful of avoidable mistakes that surface during DHCD’s compliance review (Maryland DHCD MMP, 2026). Here’s what we see most often when buyers work with our agents and an MMP-approved lender.

Top MMP Mistakes

  • Underestimating household income. Adult roommates and adult children’s income can count toward the household total even if they aren’t on the loan.
  • Skipping homebuyer education until the last minute. You can’t close without the certificate. Take the course in the first week of your search.
  • Going under contract on an ineligible condo. Not every condo project carries FHA, VA, or HFA Preferred approval. Confirm before depositing earnest money.
  • Recent ownership. If you’ve held title to a primary residence in the past 3 years and aren’t buying in a Targeted Area or using a veteran exception, you’re out.
  • Planning to rent it out. MMP requires owner occupancy. Living in one unit of a qualifying two-unit is fine. Pure investment is not.

The most expensive avoidable mistake: Locking in a non-MMP loan with a lender who never mentioned the program, then trying to switch mid-contract. By the time the buyer realizes MMP would have helped, they’re deep in underwriting on a different product, and switching means restarting the clock and risking the contract. Ask any lender, before you apply, whether they’re an MMP-approved originator.

Frequently Asked Questions

Can I use MMP if I owned a home in another state more than 3 years ago?

Yes. MMP’s first-time homebuyer rule looks at the past 3 years of primary residence ownership anywhere, not only Maryland. If you sold your last home more than 3 years ago, or you’re buying in a DHCD-designated Targeted Area, the first-time rule doesn’t block you (Maryland DHCD MMP, 2026). Eligible veterans also have a one-time waiver of the first-time rule.

Does the DSELP loan have to be paid back if I live in the home forever?

The DSELP balance becomes due on sale, refinance, transfer of title, or payoff of the first mortgage. If none of those happen, you make no payments. It’s a 0% deferred second lien with no scheduled monthly payment, per Maryland DHCD program guidelines (Maryland DHCD MMP, 2026). Most buyers eventually repay it from sale proceeds or a refinance.

Can I combine MMP with a builder incentive or seller concession?

Generally yes. Seller concessions up to FHA, VA, or conventional caps stack with MMP and DSELP, and builder incentives such as rate buy-downs are usually compatible (Maryland DHCD MMP, 2026). The lender must run any stacked incentive through DHCD compliance review, so confirm it with your loan officer before contract ratification rather than after.

Do I have to use the same lender for the first mortgage and DSELP?

Yes. Your MMP-approved lender originates both the first mortgage and the DSELP second lien at closing as part of one coordinated MMP transaction (Maryland DHCD MMP, 2026). That’s why choosing a lender already approved by DHCD, and ideally one with high MMP volume in your county, matters so much.

Your Next Step

The Maryland Mortgage Program isn’t a niche product for a small slice of buyers. For most first-time and move-up buyers shopping the $250,000 to $500,000 range, it’s the strongest financing tool on the table. The combination of competitive 30-year fixed rates, up to $15,000 in DSELP assistance, and clean layering on FHA, VA, USDA, or conventional loans means many eligible Maryland buyers can close on a home well before they thought possible.

If you want to know whether MMP fits your numbers, the cleanest first move is a short conversation with one of our agents. We’ll review your income, your target counties, and your timing, then connect you to an MMP-approved lender we’ve worked with before. Contact Next Step Realty to start, or browse Annapolis, Baltimore, Severna Park, and Towson communities to see what your MMP-powered budget actually buys.

Michael Soper writes about Maryland financing and homebuying for Next Step Realty, a brokerage with offices in Timonium and Annapolis serving buyers across Baltimore County, Anne Arundel, Howard, and Harford.

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