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Minnesota Housing down payment assistance, explained simply
The down payment is the #1 thing that keeps Minnesota renters renting — and it’s also the most solvable. Minnesota Housing, the state’s housing finance agency, pairs first-time-buyer mortgages with up to $18,000 in down payment and closing cost loans. Here’s how each piece works, and how to find out what you qualify for.
Minnesota Housing Start Up
A first mortgage program built for first-time homebuyers, offering competitive fixed rates on conventional, FHA, VA, and USDA loans through participating lenders — and it unlocks Minnesota Housing down payment and closing cost loans.
Monthly Payment Loan
Down payment and closing cost help up to $18,000 as a second loan, repaid in monthly installments over 10 years at the same rate as your first mortgage. Available with Start Up and Step Up.
Deferred Payment Loan
Up to $16,500 for down payment and closing costs at 0% interest with no monthly payment — repaid only when you sell, refinance, move out, or pay off your first mortgage. First-time buyers with a Start Up loan.
Deferred Payment Loan Plus
Up to $18,000 at 0% interest, deferred the same way, for buyers who meet targeting criteria such as single-parent households, households with a member with a disability, or first-generation buyers.
First-Generation Homebuyer options
Minnesota has offered enhanced assistance for first-generation homebuyers, with some programs reaching well beyond the standard loan amounts. Funding windows open and close — ask Steven what is available right now.
Good to know before you apply
Minnesota Housing loans are available only through participating lenders — Fairway is one. Income limits and purchase price limits vary by county and household size, a minimum borrower contribution (the lesser of $1,000 or 1% of the purchase price) applies when using assistance, and at least one borrower must complete an approved homebuyer education course. Only one Minnesota Housing first mortgage and one assistance loan can be open at a time.
Minnesota down payment assistance questions
How much down payment assistance can I get in Minnesota?
With a Minnesota Housing first mortgage, eligible buyers can receive a down payment and closing cost loan of up to $18,000. The Monthly Payment Loan offers up to $18,000 repaid over 10 years; the Deferred Payment Loan offers up to $16,500 at 0% interest with no monthly payment; and the Deferred Payment Loan Plus offers up to $18,000 at 0% for buyers who meet targeting criteria.
Do I have to pay back Minnesota Housing down payment assistance?
Yes — these are loans, not grants, but the deferred options cost nothing monthly. Deferred Payment Loans carry 0% interest and no monthly payment; they are repaid only when you sell, refinance, move out, or pay off your first mortgage. The Monthly Payment Loan is repaid in monthly installments over 10 years at the same interest rate as your first mortgage.
Who counts as a first-time home buyer in Minnesota?
Generally, anyone who has not owned a home in the past three years qualifies as a first-time buyer for the Minnesota Housing Start Up program. Income limits and purchase price limits also apply and vary by county and household size.
What credit score do I need for Minnesota Housing programs?
Minnesota Housing programs generally require a credit score of at least 640, with some flexibility depending on loan type and debt-to-income ratio. A loan officer at a participating lender can review your full picture — score, income, and debts — to confirm eligibility.
Can I combine Minnesota Housing assistance with an FHA or VA loan?
Yes. Start Up first mortgages can be conventional (Fannie Mae HFA Preferred or Freddie Mac HFA Advantage), FHA, VA, or USDA loans. The down payment assistance is layered on top as a second loan.
Is Fairway a Minnesota Housing participating lender?
Yes. Minnesota Housing loans are only available through participating lenders, and Fairway Independent Mortgage Corporation participates. Steven Tran originates Minnesota Housing loans from Fairway’s Eden Prairie branch.
Program terms, loan amounts, income and purchase price limits are set by the Minnesota Housing Finance Agency and change periodically. This page is educational and is not a commitment to lend or an offer of specific terms. Confirm current program details at mnhousing.gov or with Steven directly. Not all applicants will qualify.