New Minnesota Housing Mortgage Loan Programs – not just for First Time Homebuyers!

Through the Minnesota Housing Finance Agency (MFHA), the State of Minnesota offers eligible homebuyers loans with subsidized interest rates and mortgage insurance for low-to-moderate income homebuyers, that is MHFA_logo_rgb21-300x167correct, it is not just for first time homebuyers anymore!

Start Up is the new Minnesota Housing statewide mortgage loan program for low-to-moderate income first-time homebuyers.  Click here for detailed information on Start Up (first-time homebuyer loan program).

Step Up is a new Minnesota Housing loan program for non-first-time homebuyers to purchase or refinance a home.  The program offers affordable fixed-rate loans and access to down payment and closing cost loan options for eligible borrowers through participating lenders. Click here for detailed information on Step Up (non-first-time homebuyer loan program).

Minnesota Housing Current Interest Rates posted daily, Monday – Friday.  Click here to view current rate quote.

Are you eligible for a Minnesota Housing mortgage loan?

Start Up and Step Up each have qualifying guidelines, but to be eligible and get the process started, borrowers must meet the following minimum requirements:

  • For Start Up: Be a first-time homebuyer, meaning you have not owned a home in the past three years (This does not apply for Step Up)
  • Meet credit score and debt-to-income (DTI) ratios
    • 640-659 credit score and maximum DTI of 45%
    • 660+ credit score and maximum DTI of 50%
  • Meet household income limits: click here to view income limits.
  • Buy a qualifying home within prescribed home price limits as follows:
    • 11-County Twin Cities Metro Area – $298,125
    • Balance of State – $237,031

Minnesota Housing offers three different types of loans to help with down payment and closing costs:

  • Monthly Payment Loan – available to Start UP and Step UP
  • Deferred Payment Loan – available to Start UP only
  • HOME Homeowner Entry Loan Program (HOME  HELP) loan – available to Start UP only

What are the basic differences between the three programs?

Key Features

Monthly Payment Loan

Deferred Payment Loan

HOME HELP Loan

Loan Amount

Up to 5% of the purchase price, or $5,000, whichever is greater Up to 3% of the purchase price, or $3,000, whichever is greater $5,000 to $10,000 based on need

Loan Term

10-year term Equal to first mortgage term Equal to first mortgage term

Repayment

Amortizing loan program. Requires a monthly payment repaid in equal payments Deferred payment. Does not require monthly payments, but must be paid in full upon satisfaction of first mortgage Deferred payment, 50% of the loan forgiven after sixth year of owner occupancy. 50% repaid at end of loan term

Interest Rate

Equal to first mortgage rate Interest-free Interest-free

Income Limits

Use Program Income Limits for the first mortgage program used, either Start Up or Step Up, of if using an FHA loan, you must qualify under the FHA Income Limits Deferred Payment Loan income limits HOME HELP Loan income limits

Credit Score and Debt-to-income

Must meet credit score and debt-to-income requirement for the first mortgage program used, either Start Up or Step Up Must meet credit score and debt-to-income requirement for Start Up Must meet credit score and debt-to-income requirement for Step Up

Homebuyer Education

Required Required Required

First-time Homebuyer Requirement

No Yes Yes

Available with which Minnesota Housing first mortgage program(s)?

Start Up or Step Up Start Up Start Up from a Minnesota housing lender approved to offer HOME HELP.

 

Where can you get your Homebuyer Education?  

Homebuyer Education class must be completed by at least one of the mortgage applicants.  You can find a class to attend at the Homeownership Center Website at, http://www.hocmn.org/en/index.cfm or you can take the approved online homeownership class at http://www.frameworkhomeownership.org/

We are trained participating lenders of the MN Housing Programs, and your best option is to contact one of us today, to help you through the qualification process.
Deb Muelken | Personal ID NMLS #364933 | Company ID NMLS#4474 | Preferred Phone – 651.353.8531 | Secure Fax – 1.877.869.7392 | Email: deb@iloanhomemortgage.com or deb@debthemortgagelady.com | Website