Down payment assistance (DPA) refers to programs that provide funds to cover all or part of your down payment and sometimes closing costs when buying a home. These programs are offered by city, county, state, and nonprofit organizations and are specifically designed to help first-time home buyers overcome the barrier of saving a large down payment. Many DPA programs are grants or forgivable loans meaning you may never have to pay them back.

Eligibility varies by program but most Minnesota DPA programs require you to be a first-time home buyer (defined as not having owned a home in the past three years), meet income limits based on household size and county, purchase a home within the program's geographic area, complete a homebuyer education course, and occupy the home as your primary residence. Contact us at 952-900-7343 for a personalized eligibility assessment.

The amount varies significantly by program. Some city programs offer $5,000 to $10,000 in assistance. Minnesota Housing's Start Up program offers deferred loans up to $17,000 in some cases. Some county programs offer up to $30,000 for qualifying buyers. The key is identifying which programs you qualify for and stacking them strategically for maximum benefit. Text DPA to 952-900-7343 for our free Down Payment Assistance Guide.

A DPA grant is money you receive that never has to be repaid — it is a true gift toward your home purchase. A DPA loan is money you borrow that may be deferred (no payments until you sell or refinance), forgivable (forgiven over time as long as you stay in the home), or repayable at below-market interest rates. Most Minnesota DPA programs use deferred or forgivable loans rather than true grants, but the practical effect for most buyers is the same — no out-of-pocket cost at closing.

Minnesota Housing's Start Up program is one of the most popular DPA options in the state. It offers a low fixed-rate first mortgage combined with a deferred payment loan for down payment and closing cost assistance. The deferred loan has no monthly payment — it becomes due when you sell, refinance, or pay off the first mortgage. Income and purchase price limits apply and vary by county. Contact us to determine if you qualify for Start Up in your target area.

Yes — and this is one of the most powerful strategies we use for our buyers. It is often possible to combine a state DPA program with a city or county program to maximize your total assistance. For example a buyer might use Minnesota Housing's Start Up program alongside a city of Bloomington or Hennepin County DPA program simultaneously. Not all programs allow stacking so contact us to find out which combinations are available in your specific target area.

Some DPA programs are paired with slightly higher interest rates than market rate loans — this is how they fund the assistance. Others offer below-market rates. The net financial benefit of the DPA assistance almost always outweighs any rate difference, especially in the early years of homeownership. We always run a full cost-benefit analysis for our buyers to make sure the program we recommend is the best financial decision for your specific situation.

A forgivable loan is a form of DPA where the loan balance is gradually forgiven over a set period — typically 5 to 10 years — as long as you continue to live in the home as your primary residence. For example a $10,000 forgivable loan over 10 years forgives $1,000 per year. If you sell or move before the forgiveness period ends you repay the remaining balance. If you stay for the full term you owe nothing. For buyers planning to stay in their home long-term forgivable loans are essentially free money.

A deferred payment loan is a DPA loan that requires no monthly payments. The balance is deferred — meaning it is not due until you sell the home, refinance your mortgage, or pay off the first mortgage. Deferred loans are interest-free in most programs. They effectively function like a silent second mortgage that sits in the background with no impact on your monthly budget. This makes them ideal for buyers who want to preserve cash flow after closing.

Yes. Hennepin County offers down payment and closing cost assistance for qualifying first-time buyers purchasing in the county. The program provides deferred loans and has income limits based on household size. Many cities within Hennepin County — including Bloomington, Eden Prairie, Plymouth, and others — also have their own separate programs that can sometimes be stacked with the county program. Contact us at 952-900-7343 for current program availability in your target city.

Yes. Both Minneapolis and St. Paul have their own home buyer assistance programs offering down payment and closing cost help for qualifying buyers purchasing within city limits. These city programs can often be combined with state-level programs for maximum assistance. Income limits and eligibility requirements apply. Because these programs are updated frequently contact us directly for the most current information on what is available.

Most DPA programs define first-time buyer as someone who has not owned a home in the past three years — so even if you have owned before you may still qualify. Some programs are available to repeat buyers in targeted areas or for buyers with specific income levels. A small number of programs have no first-time buyer requirement at all. The best way to know your options is a free 30-minute strategy session where we review every program you are eligible for.

Most Minnesota DPA programs do require completion of an approved homebuyer education course before closing. These courses are typically offered online and take 6 to 8 hours to complete. They cover budgeting, the home buying process, mortgage basics, and homeownership responsibilities. The cost is usually $25 to $75. Completing the course early in your process is a good idea regardless of whether it is required — it makes the entire transaction less stressful.

DPA funds are typically reserved when your purchase offer is accepted and disbursed at closing. The timeline depends on the program but most integrate seamlessly into the standard 30 to 60 day closing timeline. Some programs have limited funding that runs out during the year — this is why starting the conversation early is critical. We can identify and reserve your DPA funds as part of the pre-approval process so you are not scrambling after you find a home.

Yes — most Minnesota DPA programs are specifically designed to work alongside FHA loans. The DPA covers your 3.5% FHA down payment requirement while the FHA loan covers the rest of the purchase price. Some DPA programs also work with conventional, USDA, and VA loans. We match you with the loan program and DPA combination that gives you the best rate, lowest cost, and maximum assistance for your specific situation.

Income limits vary significantly by program, household size, and county. As a general reference Minnesota Housing's Start Up program has income limits ranging from approximately $93,000 to $130,000+ depending on household size and location. Some city and county programs have higher or lower limits. The important thing to know is that many middle-income households qualify — DPA is not exclusively for very low income buyers. Contact us for a personalized eligibility review.

Most Minnesota DPA programs have purchase price limits that are well above median home prices in most Twin Cities suburbs — typically ranging from $350,000 to $450,000+ depending on the program and location. Higher-cost areas like certain Minneapolis neighborhoods may have higher limits. These limits are updated periodically so contact us for current figures applicable to your target area.

The fastest way is a free 30-minute strategy session with Bob Feland. As both your Realtor and Mortgage Loan Officer Bob can review your income, credit, target area, and household size to identify every DPA program you are eligible for — and help you stack them for maximum benefit. Text DPA to 952-900-7343 to get our free Down Payment Assistance Guide instantly. Or book your free session at gohomebuyersclub.com.