Minnesota Housing offers three down payment assistance products, and the choice between them comes down to one question: do you want a second monthly payment, or a balloon you settle when you sell?
There is also a first-generation program in Minnesota that gets a lot of attention. Both versions of it are currently unavailable, and that is worth knowing before you plan around it.
The three products
All three pair with a Minnesota Housing first mortgage — Start Up for first-time buyers, or Step Up for repeat buyers and refinances. Figures below are from the comparison sheet dated July 1, 2026.
Monthly Payment Loan — you pay it back monthly
Up to $14,000, structured as a fully amortizing 15-year second mortgage at the same interest rate as your first, with required monthly payments.
It is available with both Start Up and Step Up, and it has no separate income limits beyond your first mortgage program — which makes it the most broadly accessible of the three. The trade is a real second payment starting immediately.
Deferred Payment Loan (DPL) — no payment until you sell
Up to $14,000 at 0% interest, structured as a deferred balloon with a term matching your first mortgage. Not forgivable — due on sale, transfer of title, refinance, or when the home stops being your primary residence.
Start Up only, first-time buyers only, and it carries tighter gates: lower income limits, a 25% minimum housing ratio requirement, and a $13,000 post-closing liquid asset limit. That last one matters — if you have substantial savings after closing, you will not qualify.
Deferred Payment Loan Plus (DPL+)
Up to $18,000, with the same 0% deferred balloon structure and the same eligibility gates as DPL, aimed at more targeted borrowers. It is the largest deferred amount Minnesota offers.
The first-generation programs — both unavailable
Minnesota has had two separate first-generation efforts, and neither is currently taking applications.
Minnesota Housing First-Generation Homebuyer Loan — CLOSED
Minnesota Housing states the one-time funds have been exhausted and the program closed as of December 19, 2024. It cannot accept new loan commitments. If you see it listed as active, that listing is out of date.
First-Generation Homebuyers Community Down Payment Assistance Fund — PAUSED
This is a separate, community-administered fund rather than a Minnesota Housing product, and it is the most generous assistance Minnesota has offered:
- Up to 10% of purchase price, capped at $32,000.
- 0% interest forgivable loan — forgiven at 20% per year over five years while you occupy the home as your primary residence. This is the only forgivable down payment assistance in Minnesota.
- Statewide, with price caps matching Minnesota Housing’s.
Status: applications are paused. A reopening has been announced but not dated. If first-generation applies to you, it is worth monitoring — a forgivable $32,000 is dramatically better than a $14,000 deferred balloon.
Income and purchase price limits
Minnesota uses three geographic tiers: the 11-county Twin Cities metro, Dodge and Olmsted counties, and all other counties.
Start Up (first-time buyers)
- Twin Cities metro: $131,500 for one or two people, $151,200 for three or more.
- Dodge & Olmsted: $135,800 / $156,100.
- All other counties: $118,900 / $136,700.
Step Up (repeat buyers)
- $196,600 in the metro and Dodge/Olmsted; $177,800 in other counties.
DPL and DPL+
These use lower limits than the first mortgage programs, starting around $85,600 for a one-to-two person household outside the metro. This is the most common reason a buyer qualifies for Start Up but not for the deferred assistance.
Purchase price limits (effective July 1, 2026)
- One unit: $515,200 in the metro, $472,030 in other counties.
- Two units: $659,550 metro, $604,400 elsewhere.
Homebuyer education is required for all down payment assistance products.
Choosing between them
If your income fits under the DPL limits and your post-closing savings are below $13,000, take the deferred loan — no monthly payment and 0% interest is straightforwardly better than an amortizing second, and you settle it when you sell.
If your income is above the DPL threshold, the Monthly Payment Loan is your option. Just add its payment to your budget before you decide how much house you can carry, because it starts immediately.
If you are a first-generation buyer, watch the community fund. Forgivable beats deferred by a wide margin, and $32,000 beats $14,000 by more.
- Check your income against the DPL limits specifically, not just Start Up — they are much lower and are the usual disqualifier.
- Check your expected post-closing liquid assets against the $13,000 cap if you are pursuing DPL or DPL+.
- Complete homebuyer education; it is required across all products.
- If first-generation applies to you, ask your lender to flag when the community fund reopens rather than proceeding without it.
- Confirm limits at application — both income and price limits updated July 1, 2026.
Frequently asked questions
What is the difference between Minnesota’s deferred and monthly payment loans?
The Monthly Payment Loan is up to $14,000 as a fully amortizing 15-year second at your first mortgage rate, with payments starting immediately. The Deferred Payment Loan is up to $14,000 at 0% interest with no payments, due as a balloon when you sell, refinance or move out.
Is Minnesota down payment assistance forgivable?
The standard Minnesota Housing products are not — DPL and DPL+ are 0% deferred balloons that must be repaid. The only forgivable option is the community First-Generation fund, forgiven at 20% per year over five years, and its applications are currently paused.
Is the Minnesota first-generation homebuyer program still available?
No. Minnesota Housing’s First-Generation Homebuyer Loan closed on December 19, 2024 with funds exhausted. The separate community-administered First-Generation fund, offering up to $32,000 forgivable, has paused applications with a reopening announced but not dated.
Why do I qualify for Start Up but not the Deferred Payment Loan?
DPL and DPL+ use significantly lower income limits than the first mortgage programs — starting around $85,600 for a one-to-two person household outside the metro. They also impose a 25% minimum housing ratio and a $13,000 post-closing liquid asset limit.
What is the maximum home price in Minnesota?
As of July 1, 2026, $515,200 for a one-unit home in the Twin Cities metro and $472,030 elsewhere in the state. Two-unit properties are capped at $659,550 and $604,400 respectively.
How much down payment assistance can I get in Minnesota?
Up to $18,000 through DPL+, up to $14,000 through either the standard Deferred Payment Loan or the Monthly Payment Loan. The paused community First-Generation fund offered up to $32,000.