First-Time Homebuyer + Down Payment Assistance
What This Looks Like for a $350,000 Home in South Dakota
How South Dakota's First-Time Homebuyer Programs Work
South Dakota Housing Development Authority offers First-Time Homebuyer + Down Payment Assistance to qualifying first-time buyers in South Dakota. Most South Dakota 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 grant or second mortgage.
Eligibility requirements
Most South Dakota HFA programs require: (1) you haven't owned a primary residence in the last 3 years, (2) household income under ~$110,000 (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 First-Time Homebuyer + Down Payment Assistance
You don't apply directly through South Dakota Housing Development Authority — 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 South Dakota DPA with federal loans
Pair First-Time Homebuyer + Down Payment Assistance 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 South Dakota 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 South Dakota employers offer additional grants), and city/county DPA stacking (cities like the largest metros in South Dakota often add their own programs on top of state DPA).