1. Short title This Act may be cited as the Downpayment Toward Equity Act of 2023 . 2. First-generation downpayment assistance program (a) Establishment The Secretary of Housing and Urban Development shall carry out a program under this Act to provide grants to States and eligible entities to provide financial assistance under this Act to first-generation homebuyers to assist them with acquiring owner-occupied primary residences. (b) Allocation After reserving amounts as required under sections 6(d) and 8(b), any remaining amounts made available to carry out this Act shall be allocated as follows: (1) States 75 percent of such amounts shall be allocated among States in accordance with a formula established by the Secretary, which shall take into consideration best available data to provide more funding to States with a higher approximate number of potential qualified homebuyers (as such term is defined in section 10) and adjusted to reflect median area home prices. (2) Eligible entities 25 percent of such amounts shall be made available only to eligible entities on a competitive basis. (c) Assistance Amounts from a grant under this Act shall be used only to provide assistance— (1) on behalf of a qualified homebuyer; and (2) for— (A) costs in connection with the acquisition, involving an eligible mortgage loan, of an eligible home, including downpayment costs, closing costs, and costs to reduce the rates of interest on eligible mortgage loans; (B) for subsidies to make shared equity homes affordable to eligible homebuyers by discounting the price for which the home will be sold and to preserve the home's affordability for subsequent eligible buyers; and (C) for pre-occupancy home modifications required to accommodate qualified homebuyers or members of their household with disabilities. (d) Amount A grant of assistance under this Act— (1) may be provided on behalf of any qualified homebuyer only once