Are you thinking of buying your first home in Minnesota? Would you like a free gift of money to help you purchase that first home? The state of Minnesota provides free grant money for its residents who are first time home buyers and need help with the down payment and closing costs. This assistance is in the form of an interest-free loan, and if you remain in your home for 6 years or longer, 70% of the loan is forgiven, which means it is effectively a grant. There is also Federal Grant money available as well as grants from private foundations. This is free money that shouldn’t be passed up! The grant awards can be in the thousands of dollars. It will be well worth your time to educate yourself about the grant programs that are available to Minnesota residents.
Minnesota Housing Finance Agency provides affordable housing for low- and moderate-income households while fostering strong communities. They offer mortgage programs that provide affordable interest rate loans to eligible first-time homebuyers, including downpayment and closing cost assistance programs.
Here is an overview of grants and programs offered:
The Homeownership Assistance Fund (HAF) and HOME Homeowner Entry Loan Program (HOME HELP) offer interest-free, deferred downpayment and closing cost assistance loans to help low to moderate income first-time homebuyers who qualify for a Minnesota Housing loan. HOME HELP cannot be used with HAF.
HAF
• Deferred payment, interest-free loan up to $4,500
• Borrower must be eligible for the CASA program
OR
• Borrower must be eligible for MMP and meet one
of the following criteria:
• 60% of MMP median income 1, OR
• Purchasing a home in a MMP Spotlight Area
(information located on our website)
• Borrower must have $1,000 of their own funds in
the transaction and have limited assets in order to
qualify
• The loan must be fully repaid when the loan
matures, the first mortgage is refinanced, or the
property is sold or no longer owner-occupied
HOME HELP
• $10,000 deferred payment, interest-free loan
available depending on borrower eligibility
• Borrower must be eligible to receive a CASA 1st
mortgage.
• Borrower must have $1,000 of their own funds in
the transaction and have limited assets in order
to qualify
• 70% of the loan is forgiven after the sixth year
and 30% is repaid when the loan matures, the
first mortgage is refinanced, or the property is
sold or no longer owner-occupied
• Loan must be fully repaid within the first six years
if the borrower sells or vacates the property
To get complete details of the home buyer programs available, visit their website. You can also directly download a PDF that outlines the programs available and details the income requirements as well as eligibility. For a direct download, you can use this PDF.
The contact information for the Minnesota Housing Finance Agency is:
MHFA
400 Sibley Street
Suite #300
St. Paul, MN 55101
E-Mail: mn.housing@state.mn.us
Phone Numbers:
General Information: 651.296.7608 or 1.800.657.3769
Single Family Housing: 651.296.8215 or 1.800.710.8871
Federal Grants
Besides the state programs, there are federal funds and grants available to the home buyers in Minnesota through the Homes and Communities program of the United States Department of Housing and Urban Development. On their website you’ll find complete grant information, application forms, description of available funds, as well as many other helpful tools.
Every potential home buyer seeking a grant should investigate what they have to offer. You can visit the website by going here: US Dept. of Housing and Urban Development. Also, there is a website that has a complete list of all grant programs available through the United States Federal Government: Grants.gov. First time home buyers should plan to spend the required time investigating to determine how many individual grants they may qualify for. You can visit the website by going to Grants.gov and searching for more details about the grants.
Other Grants in Minnesota
In addition to the grant programs described above, the U.S. Department of Housing and Urban Development provides assistance and grants in every state. There are multiple grant programs designed specifically for people that meet certain requirements, such as grants for people with disabilities so they can continue to live independently at home. It is worth visiting HUD’s website to see what assistance is currently available. For your convenience, simply go to this website.
Here is the contact information for the HUD office in Minnesota:
Minneapolis Field Office
International Center
920 Second Avenue South
Suite 1300
Minneapolis MN 55402-4012
Phone: (612) 370-3000
Fax: (612) 370-3220
There are also these local programs:
Alexandria City Homestead Assistance Program (CHAP) (320) 762-1311
Alexandria Greater Minnesota Housing Fund The Trails Development Gap Financing Program (GAP) (651) 221-1997
Alexandria HRA Down Payment Assistance Program (DPAP) (320) 762-1311
Alexandria MHFA Gap Financing Program (GAP) (320) 762-1311
Austin/Mower County Homeownership Fund Program (507) 864-7741
Chaska Clover Ridge Owner Occupied Assistance Program (OOAP) (952) 448-2851
Duluth Neighborhood Housing Services “Homeownership Program with Employers” in Lincoln Park Grant (HOPE) (218) 727-8604
Duluth Neighborhood Housing Services of Duluth Homeownership Incentive Program (HIP) (218) 628-1057
Duluth NHS/Hillside Homeownership Incentive Program (HIPP) (218) 628-1057
East Grand Forks Downpayment Assistance Program (218) 773-2371
East Grand Forks New Construction Incentive (NCI) Program (218) 773-2371
Elliot Park Neighborhood Improvement, Inc. Homebuyers Assistance Program (612) 335-5885
Hutchinson Housing & Redevelopment Authority Down Payment Assistance Program (DPA) (320) 234-4451
Itasca County/Koochiching County KOOTASCA Community Action’s Homebuyer Program (HBP) (218) 326-8539
Mankato Homeownership Program (HOP) (507) 387-8622
Mankato Revolving Loan Fund (RLF) (507) 387-8622
Minneapolis Equity Participation Loan Program (EPL) (612) 673-5289
Minneapolis Folwell Neighborhood Association First Time Home Assistance Program (FTHP) (612) 588-3033
Minneapolis Hawthorne Homestead Program (HHIP) (612) 339-0601
Minneapolis/MCDA Closing Cost Loan Program (CCL) (612) 673-5289
Multi Cities Tri-County Actions Programs, Inc. Homeowner Gap Financing Program (GAP) (320) 255-0705
Multi Counties Arrowhead Economic Opportunity Agency Inc Homeownership Opportunity Program (HOP) (800) 662-5711
Multi Counties Headwaters Housing Development Corporation Two Note Program (TNP) (218) 444-4732
Northfield Housing Assistance Program (NHAP) (507) 645-8833
Pennington County Affordable Housing Program (AHP) Community Revitalization Fund Program (CRF) (218) 637-2431
Pennington County Affordable Housing Program (AHP) Loan Pool Funds (LPF) (218) 637-2431
Ramsey County FirstFirst Time Home Buyer Grants Program (FBAP) (651) 266-8025
Red Lake County Affordable Housing Fund (AHF) Affordable Housing Loan Pool Fund (LPF) (218) 637-2431
Red Lake County Affordable Housing Fund (AHF) Community Revitalization Fund (CRF) (218) 637-2431
Rochester First Homes GAP Loan Program (GAP) (507) 281-7396
St Paul Community Neighborhood Housing Services, Down Payment Assistance Program (DPAP) (651) 292-8710
Thief River Falls Slow Second Mortgage Program (SSMP) (218) 681-2500
Washington County First Time Home Buyer Grants Program (FBAP) (651) 266-8025
