Optimizing Affordability: A Statistical Analysis of State Housing Finance Agency Down Payment Assistance Program and Outcomes

Jefferies Financial Group works closely with State Housing Finance Agencies (HFAs) nationwide to structure and finance mortgage revenue bond programs that expand homeownership for low- and moderate-income borrowers. As housing affordability continues to deteriorate and HFAs rely increasingly on down payment assistance (DPA) to drive loan production, agencies face mounting challenges: DPA loans carry high program costs, limited repayment streams, and little empirical guidance on which structures most effectively support borrowers while sustaining HFA financial health.

This project will use multi-year administrative data from HFAs, supplemented by publicly available housing and mortgage datasets, to assess the cost, performance, and effectiveness of different DPA program designs across states. The SIPA team will conduct statistical analyses, including correlation, regression, and financial modeling, to evaluate how DPA type, size, and structure influence borrower uptake, loan production, repayment patterns, and long-term program sustainability. The goal is to identify which DPA structures deliver the strongest outcomes at the lowest cost, highlight best practices from high-performing states, and provide Jefferies and HFAs with evidence-based recommendations to optimize program design. The final report will offer actionable strategies to strengthen affordability efforts and support more prospective homeowners while ensuring the long-term viability of HFA lending programs.