Minnesota Mortgage Assistance Programs You Should Know About

Minnesota Mortgage Assistance Programs You Should Know About

Minnesota offers several mortgage assistance programsdesigned to help homebuyers afford a home—and homeowners keep it. These programs provide everything from down payment support and first-time buyer loans to foreclosure prevention and refinancingaid.

If you’re buying your first home, upgrading to a new one, or facing financial hardship, knowing your options could make a life-changing difference. Here’s a full breakdown of Minnesota’s mortgage assistance programs in 2025.

1. What Is a Mortgage Assistance Program?

Mortgage assistance programs are state-run or federally supported servicesthat help eligible homeowners and buyers manage the cost of homeownership. These programs may include:

• Down payment and closing cost loans 
• Low-interest mortgage products 
• Foreclosure prevention assistance 
• Financial counseling and education 

Minnesota offers some of the most comprehensive housing support options in the Midwest.

2. Minnesota Housing Finance Agency (MHFA): The Backbone of Homebuyer Help

The Minnesota Housing Finance Agency (Minnesota Housing)is the state’s official housing authority. It provides most of the mortgage and down payment assistance programs available in the state.

All state-backed mortgage products must go through Minnesota Housing-approved lenders.

3. Start Up Program: First-Time Buyer Mortgage with Assistance

The Start Up Programis one of Minnesota’s best-known offerings. It provides:

• A fixed-rate mortgage 
• Access to down payment and closing cost loans 
• Flexible credit and income guidelines 

Who it’s for:First-time buyers (or those who haven’t owned a home in the last 3 years).

4. Step Up Program: Mortgage and Refinance Help for Repeat Buyers

The Step Up Programis designed for:

• Current homeownerspurchasing a new home 
• Repeat buyerswho don’t qualify as first-time buyers 
• Homeowners refinancingat a lower rate 

Step Up also offers down payment and closing cost assistance.

5. Monthly Payment Loan: Assistance You Pay Back Gradually

Available through Start Up and Step Up, this option offers:

• Up to $18,000in down payment and closing cost assistance 
• Repaid monthly over 10 years at the same interest rateas the first mortgage 

This is a great option for those with steady incomewho want help now and don’t mind a second small payment.

6. Deferred Payment Loan: No Payments Until You Move or Refinance

This popular option gives qualified borrowers up to $16,500, with:

• No payments dueuntil the home is sold, refinanced, or no longer your primary residence 
• Zero interest 

Best for buyers who need help now but can’t afford an extra monthly payment.

7. Deferred Payment Loan Plus: Larger Amounts for Greater Need

Some buyers may qualify for up to $18,000in deferred assistance if they meet income limits and purchase in targeted areas.

8. Minnesota Homeowner Assistance Fund (HAF)

Created in response to COVID-19, this program helps struggling homeownerscatch up on:

• Past-due mortgage payments 
• Property taxes 
• Utility bills 
• Insurance or association fees 

Up to $50,000 in aidis available for eligible homeowners. Applications are open through HomeHelpMN.org.

9. HomeHelpMN: Mortgage Relief for Those Behind on Payments

Separate from HAF, HomeHelpMNprovides funding to:

• Avoid foreclosure 
• Reinstate delinquent mortgages 
• Access housing counseling 

This program is income-basedand serves those experiencing financial hardship due to a qualifying crisis.

10. Foreclosure Prevention Counseling

Minnesota Housing partners with nonprofit housing counselorsstatewide. These HUD-certified agencies provide:

• Budget review 
• Loan modification help 
• Mediation services 
• Transition planning if needed 

Services are freeand confidential.

11. Tribal Housing Assistance Programs in Minnesota

Many Native American homebuyers in Minnesota can access tribal-specific housing resources, including:

• Down payment help 
• Lease-to-own agreements 
• Support from Tribal Housing Authorities 

Each tribe may have its own program and eligibility criteria.

12. VA, USDA, and FHA Loans with Minnesota Assistance

Homebuyers using federal loan programs(VA, USDA, FHA) may still qualify for:

• Step Up or Start Up loans 
• Down payment assistance 
• Interest rate discounts through Minnesota Housing-approved lenders 

Combining federal and state programs is a common strategy in Minnesota’s homebuying process.

13. Employer-Based Housing Support

Some Minnesota employers—especially hospitals, universities, and tech companies—offer:

• Homebuyer education reimbursements 
• Down payment match programs 
• Location-based housing stipends 

Check with your HR department to see if assistance is available.

14. How to Apply for Mortgage Assistance in Minnesota

To access most state programs, you must:

1. Work with a Minnesota Housing-approved lender 
2. Complete a loan application and income documentation 
3. Take a homebuyer education course(if required) 
4. Get pre-approved and select your preferred assistance option 

You can also apply directly to programs like HomeHelpMNor Homeowner Assistance Fundonline.

15. Documents You’ll Need to Qualify

Be prepared to provide:

• Government-issued ID 
• Tax returns and W-2s 
• Pay stubs or proof of income 
• Bank statements 
• Rental history (if applicable) 

Some programs may require additional verification.

Looking for a Lender That Offers Minnesota Housing Programs?

First Class Mortgage is a Minnesota Housing-approved lender with years of experience guiding homebuyers and homeowners through every option available.

Call (763) 416-6789or schedule a consultationto learn which assistance program is right for you.