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First-Time Home Buyer Down Payment Assistance Programs in Minnesota and South Dakota

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Are you considering buying your first home in Minnesota or South Dakota but unsure if it’s feasible?

At Sunrise Banks, we are not only passionate about financial wellness; we believe you deserve a chance at homeownership.

The process of buying your first home can be overwhelming. Our mortgage lenders are here to assist you in this journey and help make your dream of owning your home a more affordable reality.

We’ve compiled down payment assistance program information and resources below to help you on your journey as a first-time home buyer in Minnesota and South Dakota.

What is a down payment?

Most home mortgages require a down payment, which is a portion of the home’s purchase price that the buyer pays upfront. The down payment is typically paid in cash, certified check, or equivalent at closing. The mortgage covers the remainder of the purchase price and repays monthly.

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What are the minimum down payment requirements for the mortgage programs offered through Sunrise Banks?

Down payment requirements vary by program, lender, income, credit history, and other variables. Sunrise Banks is pleased to offer various lending options to meet your needs as a first-time home buyer in Minnesota or South Dakota.

Each of our mortgage programs has a specified minimum down payment requirement, outlined below:

  • Sunrise Banks Pathway2Home® ITIN Mortgage:

    10%

  • HomeReady™ Mortgage:

    3%

  • Minnesota Housing Finance Agency (MHFA) Mortgage:

    3%

  • Conventional Fixed-Rate Mortgage:

    As little as 5%

  • Adjustable-Rate Mortgage:

    5%

  • Investment Property Mortgage:

    20%

How do I apply for down payment assistance?

To get started, meet with a loan officer at Sunrise Banks. They’ll help you find assistance programs that match your financial situation and guide you through the application and documentation process. Along the way, they’ll walk you through the program terms to guarantee you’re able to make an informed decision. Several team members also offer bilingual services for added support.

How do you qualify for down payment assistance?

Whether you’re a first-time home buyer or not, eligibility for down payment assistance in Minnesota or South Dakota depends on the type of program you choose for your path to housing. It is usually assessed on several factors, including income, credit score, purchase price, home location, and whether or not it’s your first time buying a home.

Other requirements might include the use of an approved lender or the completion of financial education instruction.

The best way to determine your eligibility is to research the different options to see which programs are best for you and then meet with one of our experienced loan officers at Sunrise Banks.

What is down payment assistance?

The good news is that down payment assistance may help make your experience as a first-time home buyer in Minnesota and South Dakota more affordable. While most programs are intended for first-time homebuyers, repeat homeowners may also be eligible for specific programs.

By taking advantage of down payment assistance options, you may be able to afford your first home, lower your interest rate, and reduce or eliminate private mortgage insurance. Use our home loan calculator to see how down payment assistance options could help make a home — from St. Paul to Sioux Falls and beyond — more accessible.

We would love to help you qualify for down payment assistance with Sunrise Banks. Our mortgage loan officers are here to help. Off Site Link

Down payment assistance programs for MN and SD residents typically fall under the following main categories:

Grants

Grants are the most desired form of down payment assistance. They are essentially cash gifts that qualified home buyers are not required to repay. Grant programs are offered through state or local governments, nonprofit organizations, or other private- or public-sector entities.

Forgivable Loans

Forgivable loans are considered second mortgages with zero percent interest. They are forgiven once the homeowner meets specific requirements, such as remaining in the home for a specified time. If the borrower fails to meet the stated requirements, part or all of the loan must be repaid.

Deferred Loans

Some homebuyers may qualify for a second mortgage loan with deferred repayment. For deferred loan borrowers, payment is due when selling the home, refinancing, or after the first mortgage is paid down.

Low-Interest Loans

A low-interest loan is a second mortgage borrowed as the first mortgage is finalized. Low-interest loans and payments for the first mortgage are paid back in installments – usually monthly. The goal is to secure the lowest interest rate possible for maximum affordability.

Matched Savings Programs

Some banks, government entities, and other organizations will match the amount of money placed in a savings account with that institution. The total funds saved in the account can then be used toward a down payment. The specific match amount and other terms vary by program.

Tax Incentives

Certain tax credits and incentives may be available for qualified homebuyers. The Mortgage Credit Certificate (MCC) Program is an annual federal income tax credit Off Site Link created to help low- to moderate-income individuals and families afford homeownership. This tax incentive allows borrowers to claim a refund for a percentage of the interest paid yearly on their home. MCCs are intended for first-time homebuyers and vary on a state-by-state basis.

How do I contact a Sunrise Banks mortgage loan officer for help?

The path to owning a home can be complex, but our Sunrise Banks Mortgage Lenders provide personalized services for your unique position.

From determining eligibility to completing applications, our loan officers will guide you every step of the way, keeping your financial wellness front and center throughout the process.

Are you ready to determine if you qualify for down payment assistance and begin your home-buying experience?

Reach out to any seasoned lenders on our team via the form below, or in person at one of our convenient branches for customized assistance, resources, and insight to help you safely and affordably fulfill your dream of homeownership.

Not sure where to start?

Fill out the form below and someone who can help will be in touch as soon as possible.

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