Start Up + Monthly Payment Loan
What This Looks Like for a $350,000 Home in Minnesota
How Minnesota's First-Time Homebuyer Programs Work
Minnesota Housing offers Start Up + Monthly Payment Loan to qualifying first-time buyers in Minnesota. Most Minnesota buyers pair this with an FHA, VA, USDA, or Conventional 97 loan, using the DPA to cover the down payment, closing costs, or both. The DPA is structured as deferred or monthly second mortgage.
Eligibility requirements
Most Minnesota HFA programs require: (1) you haven't owned a primary residence in the last 3 years, (2) household income under ~$134,000 (county-dependent), (3) minimum FICO score of 640-680, (4) the home is your primary residence, (5) you complete a HUD-approved homebuyer education course (typically online, ~6-8 hours).
How to apply for Start Up + Monthly Payment Loan
You don't apply directly through Minnesota Housing — you apply through one of their participating lenders. The agency lists approved lenders on their website. Get pre-approved with at least 2-3 of them: rates and fees vary, even within the same DPA program.
Combining Minnesota DPA with federal loans
Pair Start Up + Monthly Payment Loan with FHA (3.5% down, 580+ FICO) for the easiest qualifying. Veterans should use VA loans (0% down) — DPA still helps with closing costs. Rural buyers should check USDA (0% down). Buyers with 3-5% down and good credit can use Conventional 97 or HFA Preferred for lower mortgage insurance.
Other Minnesota buyer benefits
Beyond DPA, ask your lender about: Mortgage Credit Certificates (MCC) for federal tax credits up to $2,000/year, employer-assisted housing programs (some Minnesota employers offer additional grants), and city/county DPA stacking (cities like the largest metros in Minnesota often add their own programs on top of state DPA).