Bootcamp For Buyers

Minnesota Step Up Program

The Minnesota Step Up Program, administered by Minnesota Housing, is designed to assist repeat homebuyers and homeowners seeking to refinance. By offering affordable fixed-rate mortgages and financial assistance, the program ensures that stable homeownership remains attainable for Minnesota residents.

Benefits

  • Provides 30-year fixed-rate mortgages with competitive interest rates for predictable and manageable monthly payments.
  • Offers down payment and closing cost assistance of up to $18,000, reducing upfront costs for eligible buyers.
  • Includes reduced private mortgage insurance (PMI) options, lowering monthly expenses.
  • Supports repeat homebuyers and homeowners refinancing their existing mortgages.
  • Allows participants to combine assistance with other Minnesota Housing programs for enhanced financial flexibility.

Eligibility Requirements

  • Applicants must meet income limits, which vary based on household size and the property’s location within Minnesota.
  • The property must be located in Minnesota and used as the buyer’s primary residence.
  • A minimum credit score of 640 is typically required, with lender-specific underwriting criteria also applicable.
  • Debt-to-income ratios must comply with program guidelines to ensure affordability and financial readiness.
  • Completion of a Minnesota Housing-approved homebuyer education course may be required for participants to prepare for homeownership responsibilities.

Additional Information

The Minnesota Step Up Program is a vital resource for repeat homebuyers and refinancing homeowners looking to maintain stability and affordability in their housing. By offering targeted financial assistance and competitive mortgage options, the program empowers eligible participants to secure stable housing and invest in their long-term future. Administered by Minnesota Housing, the Step Up Program supports sustainable homeownership and strengthens communities throughout the state.

Frequently Asked Questions About Our Program

What is the Minnesota Step Up Program?

The Minnesota Step Up Program offers affordable mortgage financing and down payment assistance for repeat homebuyers or those looking to refinance, making homeownership more accessible.

Who qualifies for the Step Up Program?

The program is open to both first-time and repeat homebuyers who meet income, credit, and property eligibility requirements. It is also available to homeowners seeking to refinance their primary residence.

What types of mortgages are available through the Step Up Program?

The program offers 30-year fixed-rate mortgages, ensuring stable and predictable monthly payments over the life of the loan.

Does the Step Up Program provide down payment assistance?

Yes, eligible buyers can access up to $18,000 in down payment and closing cost assistance to help reduce upfront expenses.

Is the down payment assistance a loan or a grant?

The assistance is provided as a loan, which may be deferred or require monthly payments depending on the buyer’s needs and the program option selected.

What is the minimum credit score required for the Step Up Program?

A minimum credit score of 640 is generally required, though FHA loans or other circumstances may require a higher score of 660.

Are there income limits for the Step Up Program?

Yes, income limits apply and are based on household size and the location of the property. These limits are reviewed and updated annually.

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What is the maximum purchase price allowed under the Step Up Program?

The maximum purchase price is typically $450,000, though this limit may vary based on the property location.

What types of properties are eligible for the Step Up Program?

Eligible properties include single-family homes, townhouses, and condominiums. Certain manufactured homes may qualify if they meet program requirements.

Can the Step Up Program be used for refinancing?

Yes, the program allows refinancing of primary residences in addition to providing support for home purchases.

Is homebuyer education required for the Step Up Program?

Yes, completing a homebuyer education course may be required to ensure buyers are financially prepared for homeownership responsibilities.

Can the Step Up Program be used for newly built homes?

Yes, newly constructed homes are eligible as long as they meet program requirements and will be the buyer’s primary residence.

Are there debt-to-income (DTI) ratio limits for the Step Up Program?

Yes, the program typically requires a maximum DTI ratio of 45%, though exceptions may apply based on other qualifying factors like credit history.

Are there reserve requirements for the Step Up Program?

No specific reserve requirements are imposed, but having reserves may strengthen an applicant’s overall loan profile during the approval process.

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What fees are associated with the Step Up Program?

Standard loan-related fees, including origination, appraisal, and processing fees, may apply. Borrowers should consult their lender to understand all costs.

What happens if I sell or refinance before the assistance loan is fully repaid?

For deferred loans, the full balance becomes due if the home is sold, refinanced, or no longer used as the primary residence. For monthly payment loans, terms remain as agreed unless refinanced.

Can the Step Up Program be combined with other assistance programs?

Yes, the program can often be combined with other local, state, or federal assistance programs to maximize financial support.

Are there location restrictions for the Step Up Program?

The property must be located in Minnesota, and specific guidelines apply based on whether the property is in a targeted or non-targeted area.

What are the benefits of the Step Up Program?

The program provides competitive mortgage rates, significant down payment assistance, and access to refinancing options, making it easier for buyers to achieve or maintain homeownership.

What is the loan term for the Step Up Program?

The program offers a 30-year fixed-rate mortgage, providing long-term affordability and stable monthly payments for homebuyers.

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