Applications Now Being Accepted
Forgivable First Generation Homebuyers
Community Down Payment Assistance Fund
Work through the steps below to take advantage of this new funding source.
Am I Eligible?
For this program, you are a First-Generation Homebuyer if you AND your parent(s) or legal guardian(s) never owned a home in any country, OR owned a home but lost it due to foreclosure. You also must be a current resident of Minnesota.
Here are two scenarios where the buyer would NOT qualify as a First-Generation Homebuyer:
- If you or any of your parents/legal guardians owned a home at any time, you are not a first-generation homebuyer, regardless of whether your parents/legal guardians are living or not.
- If you or any of your parents/legal guardians married someone who owned a home, you are not a first-generation homebuyer. Marrying someone who owns a home means that you have ownership interest, even if you are not listed on the mortgage.
The only exceptions to the two scenarios above are if you or your parents/legal guardians previously owned a home that was lost due to foreclosure, and you/your parents/guardians have not owned a home since the foreclosure.
When you apply for the First-Generation Homebuyers Community Down Payment Assistance Fund, you will be required to a sign a First-Generation Homebuyer Affidavit, which is a legal document confirming you meet the qualifications laid out above. If someone knowingly misrepresents their eligibility, they are committing mortgage fraud.
At least one buyer must be a First-Generation Homebuyer and a resident of Minnesota. All other buyers (co-borrowers) must be first-time homebuyers, meaning they haven’t owned a home in the last three years. Non-occupant co-borrowers and co-signors are not allowed.
Yes. The total income of all buyers (everyone listed on the mortgage loan) must be at or below:
- $124,200 for buyers currently living in the 11-county Twin Cities Metro (Anoka, Carver, Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington and Wright);
- $117,200 for buyers living in Dodge or Olmsted county;
- $111,800 for buyers living in any other Minnesota county.
Additionally, after closing on the loan, the buyers’ available savings (liquid assets) can’t be more than $50,000. This doesn’t count things like retirement accounts, life insurance or college savings accounts.
These limits are in place to ensure the funds are going to buyers who otherwise wouldn’t be able to afford a home without this assistance.
Yes. Within the last 12 months, the first-generation buyer on the loan (we recommend everyone) must have completed an approved homebuyer education workshop. These include Home Stretch and Realizing the American Dream. Framework, which is a self-guided online course, is also acceptable. This workshop must be completed BEFORE submitting a Purchase Agreement.
How Does It Work?
Eligible recipients can receive up to ten percent of a home’s purchase price, capped at $32,000.
The down payment assistance provided under this program is a zero-interest loan that is forgiven over five years (20% forgiven each year), as long as the homebuyer lives in the home as their primary residence.
You can purchase a 1–2 unit home located in anywhere Minnesota. Shared equity, community land trusts and other resale restricted purchases are permitted.
This program does have maximum purchase prices. This means that if you buy a one-unit home in the 11-county metro, the home cannot cost more than $515,200, and a 2-unit home cannot cost more than $659,550. If you buy anywhere else in the state, a one-unit home cannot cost more than $472,030, and a 2-unit home cannot cost more than $604,400.
How Do I Apply?
You can apply by clicking the “Apply Now” button at the top of this page.
There are several things you need to do before applying to the program:
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Within the last 12 months, the first-generation buyer on the loan (we recommend everyone) must have completed an approved homebuyer education workshop These include Home Stretch and Realizing the American Dream. Framework, which is a self-guided online course, is also acceptable. This workshop must be completed BEFORE submitting a Purchase Agreement. You will provide your Homebuyer Education Certificate of Completion as part of the initial application process.
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You need to be preapproved for a fixed-rate mortgage from the lender of your choice. [Note that Sharia Compliant and Individual Taxpayer Identification Number (ITIN) mortgages are accepted.] We recommend taking this step after completing a homebuyer education workshop.
- While not required, you also can enlist the services of a Homebuyer Advisor who can assess your mortgage readiness and create a personalized ‘road-map’ to securing a low mortgage interest rate. These services are free and available to anyone in Minnesota.
Applications are accepted on a first come, first served basis. Having your application accepted is NOT a guarantee that you will receive funds, but rather the first step in a multi-step process. Once this process is complete, approved applicants will have funds reserved for 90 days. Once you are approved for funds, you can start shopping for a house using the Realtor® of your choice.
The First-Generation Homebuyers Community Down Payment Assistance Fund is different from Minnesota Housing’s First-Generation Homebuyer Loan Program. The programs cannot be used together. Both are funded by the state, and the goal of the programs is to help more first-generation homebuyers access homeownership.
A homeownership advisor can help you determine which program is best for you. Find a homeownership advisor.
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