Buying a home in the Twin Cities of Minnesota can be an exciting yet daunting task, especially when it comes to finding the money for your downpayment. Fortunately, there are several options available to help you secure the necessary funds. Here’s a comprehensive guide on how to find money to buy a home.

Downpayment Assistance Programs

1. Minnesota Housing Finance Agency (MHFA): The MHFA offers several programs designed to assist first-time homebuyers with downpayment and closing costs. The Start Up program, for instance, provides loans of up to $17,000, which can be used towards your down payment or closing costs. These loans are typically deferred, meaning you won’t have to start repaying them until you sell, refinance, or pay off your mortgage.
2. Local Programs: Various cities and counties within the Twin Cities metro area also offer down payment assistance. For example, the Minneapolis Advantage Program provides up to $10,000 in forgivable loans to help with down payment and closing costs. Similarly, the Saint Paul Home Loan Fund offers deferred loans up to $40,000 for first-time homebuyers.

Government Help

1. Federal Housing Administration (FHA) Loans: FHA loans are a popular choice for first-time homebuyers due to their low down payment requirements—often as low as 3.5%. These loans are insured by the FHA, which allows lenders to offer more favorable terms to borrowers with less-than-perfect credit.
2. VA Loans: If you are a veteran or active-duty service member, you may qualify for a VA loan. These loans are backed by the U.S. Department of Veterans Affairs and often require no down payment and offer competitive interest rates.
3. USDA Loans: For those looking to buy in more rural areas around the Twin Cities, USDA loans offer 100% financing, meaning no down payment is required. These loans are backed by the U.S. Department of Agriculture and are available to low-to-moderate-income buyers.

Mortgage Lender Offerings

1. First-Time Homebuyer Programs: Many mortgage lenders offer special programs for first-time homebuyers. These programs can include reduced interest rates, lower down payment requirements, and assistance with closing costs. For example, lenders like Wells Fargo, U.S. Bank, and Bank of America have programs specifically tailored for first-time buyers.
2. Lender Credits: Some mortgage lenders offer lender credits, which can be used to cover closing costs. While this may result in a slightly higher interest rate, it can reduce the amount of money you need to bring to the table upfront.

Conclusion

Finding money to buy a home in the Twin Cities doesn’t have to be an insurmountable challenge. By leveraging down payment assistance programs, government help, and mortgage lender offerings, you can ease the financial burden and make your dream of homeownership a reality.

Curious for more info or need help? Just reach out today and we will gladly help you find the right resources for you to help you in your home search!