Minnesota first time home buyer programs
Minnesota Housing offers several programs and options to help people buy their first home.
Minnesota Mortgage Program (MMP)
The Minnesota Mortgage Program is a first time home buyer loan program that helps low to moderate income Minnesotans buy their first home. Qualified applicants are first time home buyers with acceptable credit, have an income at or below prescribed Minnesota Housing income limits and want to buy a qualifying home. The home must be in the 11 – County metro and 1-4 person households must have income under $84,000. Outside the metro area there are lower income limits depending on the county. These affordable, low interest, fixed rate loans are available to eligible homebuyers statewide.
Community Activity-Set Aside Program (CASA)
Community Activity Set Aside program is a loan program that helps low to moderate income Minnesotans buy their first home. These affordable, low interest, fixed rate loans are available to eligible homebuyers through participating lenders in several communities around Minnesota. Homebuyer education is required for all borrowers receiving a CASA loan. Using CASA gives you $4500 toward down payment or closing costs. This is considered a “special mortgage” in that it is a lien against your home, BUT it’s interest free and payment free. When you sell or refinance, the “special mortgage” must be repaid. You are required to have $1000 of your own funds into the transaction.
Qualified applicants are first time home buyers with acceptable credit, have an income at or below prescribed Minnesota Housing income limits and want to buy a qualifying home. Some residents may also qualify as an eligible targeted market for one of the CASA Community Initiatives in either the Twin Cities Metro Area or Greater Minnesota.
CASA Eligible Target Markets:
- Emerging Markets: Households of Color or Hispanic Ethnicity or pilots endorsed by the Emerging Markets Homeownership Initiative (EMHI)
- Single Headed Households: A family with one adult householder, no spouse/partner in the household, and one or more dependents in the household.
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Must have $1000 of own funds into the transaction-gift funds are not considered your funds.
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Maximum household income for 1-4 people household is $67,200.
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Household with a disability.
Homeownership Assistance Fund (HAF)
Through the Homeownership Assistance Fund, Minnesota Housing provides qualified homebuyers with an interest-free, deferred loan to help with down-payment and closing costs. First time homebuyers interested in down-payment and closing costs assistance should determine if they are qualified with a Minnesota Housing approved lender prior to signing a purchase agreement. Home Buyers may be eligible if they meet one of the following criteria:
- Borrowers eligible for the CASA program
- Qualify as an eligible target market
- Household earning 60% (or less) of area median income
Homeowner Entry Loan Program (HOME HELP)
Through the Homeowner Entry Loan Program, Minnesota Housing also provides eligible homebuyers who qualify for a Minnesota Housing loan with the opportunity to receive an interest-free, deferred** loan to help with down-payment and closing costs. Applicants may be eligible for HOME HELP if they:
- Are spending over 25% of their gross monthly income towards their house payment
- Are eligible for the CASA program as described above
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Have $1000 of their own money to put toward the transaction(no gifts)
- Have an income at or below HOME HELP program limits(lower than MMP and CASA Limits)
- Qualify as an eligible target market for one of the CASA Community Initiatives approved to offer HOME HELP
HOME HELP provides an interest free, deferred loan with repayment of the full loan amount in the first 5 years of the loan. After the first six years, the principal of the assistance will be reduces to 30% of the initial loan amount. You can get up to $8,500, which depends on how much your payment is relative to your gross income (housing ratio)
Additionally, Minnesota Housing Mortgage Insurance Partners provide borrowers with lower mortgage insurance rates and involuntary unemployment insurance at no extra cost.
Home Buyer qualifications
To qualify for most of the programs, the applicant must be a first time home buyer, meaning they could not have ownership in a home within the last 3 years. They must also have acceptable credit. Income limits and home purchase price limits vary from county to county.
To qualify for The Minnesota Mortgage Program your MHFA Eligibility Income must not exceed the following:
| Household Size | 11-County Twin Cities Metro Area* | Balance of State |
| 1-4 Persons | $67,200 | $58,400 |
| 5 Person | $72,600 | $63,100 |
| 6 Person | $78,000 | $67,800 |
| 7 Person | $83,400 | $72,500 |
| 8 Person | $88,800 | $77,100 |
| 9 Person | $94,100 | $81,800 |
| 10 Person | $99,500 | $86,500 |
The home you purchase must fall within the following cost limits:
| 11-County Twin Cities Metro Area* |
Balance of State |
| $298,125 | $237,031 |
If you’ve always wanted a home of your own, these programs can make it possible. Even if you don’t think you can afford it or don’t have a down payment, Minnesota Housing programs truly can lead you on the path to homeownership.
Ben Coulter
612.384.7818
Ben@UptownFinancial.com
Minnesota First Time Home Buyer Down Payment Assistance Program
Serving Mankato, North Mankato, Northfield, Minneapolis, St. Paul, Brainerd, St. Cloud, Rochester, Duluth and all other cities in Minnesota.
