Hennepin County has a new assistance program providing almost double the assistance dollars as in past programs. It is possible to receive up to $30,000 in down payment and closing cost assistance. These funds are interest free and are forgivable over a 10-year period (however, the forgiveness is not a prorated forgiveness).
Here are the primary criteria for eligibility:
- Borrower’s gross household income must be at or below 115% of the area median income (“AMI”). For example, this is currently is $143,650 for a household size of 4. This income restriction does vary by household size.
- Must be a first-time homebuyer which is described as not having an ownership interest in a home for the last 3 years.
- Borrowers need to contribute at least $1,000 toward the purchase from their own funds.
- Housing debt to income ratios not to exceed 50% on the back end of total gross income.
The amount of assistance funds available to a buyer does vary depending on where your household income falls on the AMI charts:
- If your household income is below 60% of AMI, you would be eligible for $20,000-30,000 in assistance.
- If your household income is 61-80% of AMI, you would be eligible for $10-20,000 in assistance.
- If your household income is 81-115% of AMI, you would be eligible for up to $10,000 in assistance.
So even if you are a higher income earning household, you may still be eligible for $10,000 assistance!
There are education requirements for the program, too:
- Buyers must complete a Home Stretch class within one year of purchase and obtain the certificate of completion. If there are two buyers, both must complete the Home Stretch class. Previous assistance programs have allowed other buyer classes to be used interchangeably, but the Hennepin County Homebuyer Assistance Program only allows the Home Stretch class to be used. Contact us to help you find available Home Stretch classes.
- Buyers must also complete a one-on-one financial counseling session. Again, if there are multiple buyers, ALL must complete the counseling session.
The Hennepin County Homebuyer Assistance Program can be used to buy a detached single-family unit, townhome, or condominium. The property purchase price must be below the 2024 FHA lending insurance limit of $498,257.
Again, this program is limited to just Hennepin County purchases. A key component is you must have a purchase agreement in hand before applying for the assistance. Advance planning now will help ensure you are able to utilize the funds from this very attractive program. Funds will be available until they run out. (Note to non-Hennepin County buyers: There are statewide funds available for other counties but they have a smaller amount of assistance available and the assistance received is not forgivable.)
This new Hennepin County assistance program is available until the funds run out. While we hope this program would be re-funded each year, there is no guarantee of that; if new programs are not utilized, they can be eliminated fairly quickly.
Help spread the word! If you are a first time buyer, or know a first-time homebuyer who could utilize this program, contact us for more information. We would love to help you, or those you know, take advantage of this phenomenal and rich assistance program! You can contact us by clicking the contact icon above. Then, we can help get you set up with a qualified lender, the required classes and put you on track to owning your own home!
Real Estate | Your@HomeTeam 