Minnesota Housing's down payment assistance programs are changing. The program that had been called HomeHelp has been discontinued as of August 29th. There are currently two programs available, one is a deferred payment and the other is a monthly payment program. Starting October 1st, there will be a new deferred payment plus program.
The current programs are not changing. The deferred payment is just that – down payment assistance that does not have to be paid back until you sell your home or pay off the mortgage. The interest rate is 0%. There are income limits of about $60,000 depending on the number of people in your household.
The montly payment program is also staying the same. You have to pay back the down payment assistance over a 10 year term with the interest rate matching the first mortgage rate.
Both programs allow you to get up to 5% of the purchase price, with limits of $7500 on the deferred payment program.
The new program, deferred payment plus, will allow up to $10,000 in down payment assistance. The program income limits are the same as the regular deferred program with a couple other requirements. You must meet two of the following requirements:
- Single-parent household with a dependent
- Household of four or more people
- Disabled household member
- Front-end ratio of 28% or higher
These programs are used with the start up first time homebuyer program offered by MN Housing. There is also a MCC Program (Mortgage Credit Certificate), this program allows you to deduct additional mortgage interest as a tax credit on your income taxes.
If these are programs that you are interested in, please contact a lender that is listed on MN Housing's website or email or call me. Lenders do have to be approved to do these programs. The down payment assistance programs can help you come up with enough money to have the down payment required. You do need $1000 into the transaction and you can use either conventional, VA or FHA mortgage programs depending on your situation. Talk to your lender and see if this is an option for you!