North Dakota is one of the more affordable places in the country to buy your first home. Prices here generally run below the national average, and even in the larger cities of Fargo, Bismarck, and Grand Forks you’ll typically find more house for your money than buyers get in most metros. That affordability, combined with a well-run state housing agency, makes North Dakota a genuinely friendly place to make the leap from renting to owning. This guide breaks down how it all works in plain English, the way we’d explain it to a family member sitting at the kitchen table wondering if they can actually pull this off.
We’ll cover the headline down payment assistance programs, how to choose a loan, what closing actually costs, how the buying process runs (including a 2024 rule change), and the questions North Dakota first-timers ask most. For national fundamentals alongside this, our first-time buyer guide is a solid companion.
The headline program: North Dakota Housing Finance Agency (NDHFA)
The North Dakota Housing Finance Agency, known as NDHFA and operating under the “ND Housing” banner, is the state agency behind North Dakota’s first-time homebuyer programs. NDHFA works a little differently from some agencies: for its assistance programs, you typically secure your first mortgage through NDHFA itself via a participating lender. Either way, your task is to connect with an NDHFA-participating lender, and this guide helps you know what to ask.
NDHFA’s programs center on FirstHome, its main first-time buyer mortgage, and the Down Payment and Closing Cost Assistance (DCA) program that pairs with it. There’s also a Start program for a slightly broader range of buyers.
FirstHome
FirstHome is NDHFA’s flagship loan for eligible first-time buyers. It offers below-market mortgage rates to low- and moderate-income borrowers, and it works with conventional, FHA, VA, or USDA loans underneath. In other words, FirstHome gives you a favorable rate, and you still pick the loan type that fits your situation. FirstHome can also be paired with down payment and closing cost assistance, which is where DCA comes in.
Down Payment and Closing Cost Assistance (DCA)
The DCA program helps low-income first-time buyers cover their out-of-pocket cash. It provides assistance equal to 3% of the first mortgage loan amount, or $3,000, whichever is greater, which you can put toward your down payment, closing costs, and/or prepaid items (like the property taxes and insurance that get set aside in escrow at closing). That “whichever is greater” wording is buyer-friendly: on smaller loans it guarantees at least $3,000 of help.
To use DCA, you secure your first mortgage through NDHFA and contribute at least $500 from your own cash. DCA is aimed at income-eligible buyers, so it’s specifically designed to reach households that need the help most. Our down payment assistance primer explains how programs like this fit into your overall plan.
The Start program
NDHFA also runs a Start program to make buying more affordable for low- to moderate-income buyers, with down payment and closing cost assistance attached to an NDHFA mortgage. If you don’t fit DCA’s tighter income box, Start may be an alternative, so ask your lender to compare the two for your situation.
Who qualifies: first-time status, contribution, income, and education
- First-time status: DCA and FirstHome are for first-time buyers, defined the standard way, meaning you haven’t owned a home in the past three years.
- Your own contribution: You must contribute at least $500 from your own cash assets.
- Income limits: Income limits apply and vary by county and family size; DCA targets lower-income buyers specifically. Your lender checks the current figures.
- Homebuyer education: You must complete a homebuyer education course, and your certificate must be dated before your loan closes, so do it early.
- Credit: Standard credit underwriting standards apply.
On the education requirement: it’s genuinely worthwhile, and the timing matters here, your completion certificate has to be dated before closing, so knock it out early. A good course explains how your payment is built, how escrow works, and how to avoid the common first-year money surprises.
Which loan is right for you?
NDHFA’s FirstHome works with several loan types underneath, so you still choose the one that fits. Here’s the quick tour.
FHA loans
FHA loans, insured by the Federal Housing Administration, are the classic first-timer’s mortgage: down payments as low as 3.5% and more forgiving credit requirements, in exchange for mortgage insurance built into the loan. For many North Dakota buyers with modest savings, FHA is the on-ramp. Our FHA loan guide has the full picture.
USDA loans
North Dakota is one of the best USDA states in the country. The vast majority of the state, essentially everything outside the cores of Fargo, Bismarck, and Grand Forks, qualifies as “rural” under USDA’s map, and USDA loans allow zero down payment for eligible buyers under the income limits. If you’re buying in a smaller town, this is a powerful option. See our USDA loan guide to check whether an address qualifies.
VA loans
North Dakota has a strong military and veteran presence, including around Minot and Grand Forks Air Force Bases. If you’re a veteran, active-duty service member, or eligible surviving spouse, a VA loan is usually the strongest deal: zero down, no monthly mortgage insurance, and competitive rates.
Conventional loans
Conventional loans aren’t government-insured, and some first-time buyer versions allow as little as 3% down. With strong credit, a conventional loan lets you drop mortgage insurance once you reach 20% equity. NDHFA’s FirstHome works with conventional loans, so this is a valid path.
What homes cost and what you’ll need
North Dakota’s affordability is one of its biggest advantages for first-time buyers. Prices generally run below the national average, with Fargo, Bismarck, and Grand Forks on the higher end for the state and smaller communities offering the most modest tags. Wherever you buy, budget for more than the down payment.
Closing costs typically run about 2% to 5% of the purchase price. These are the fees to finalize the loan and transfer ownership: lender charges, title insurance, appraisal, recording fees, and prepaid items like property taxes and homeowners insurance set into escrow. Even on an affordable North Dakota home, that can add up to a few thousand dollars, which is exactly why DCA, which can cover closing costs and prepaid items, is so helpful.
Property taxes in North Dakota run around the middle of the pack nationally, neither especially high nor especially low, and rates vary by county and city. That ongoing cost shows up in your monthly payment through escrow, so ask your lender to show the full monthly cost including taxes and insurance, not just principal and interest, so your budget reflects reality.
The encouraging bottom line: with DCA providing at least $3,000 (or 3% of the loan), a low overall price environment, and low-or-zero-down loan types like FHA, USDA, and VA, the upfront cash barrier in North Dakota is often quite small compared with much of the country.
The buying process in North Dakota
Here’s the sequence most North Dakota first-time buyers follow, plus a 2024 rule change to understand before you tour homes.
As of August 17, 2024, a national settlement involving the National Association of Realtors (NAR) changed how buyer’s agents are hired and paid. Two things are new. First, before an agent shows you homes, you must sign a written buyer agreement that spells out how much your agent will earn and who pays it. Second, agent commissions are no longer advertised on the MLS (the shared listing database) and are openly negotiable. In practice, discuss your agent’s fee upfront, get it in writing, and know it’s negotiable. This isn’t a reason to skip having an agent, a good one is well worth it, it just means you go in informed. Our NAR settlement explainer covers it in depth.
- Get pre-approved. Talk to an NDHFA participating lender first. They’ll confirm your budget, check the income limits, and tell you whether FirstHome, DCA, or Start fits.
- Complete homebuyer education early. Remember, your certificate must be dated before closing, so don’t leave it until the last minute.
- Hire a buyer’s agent. Interview one or two, discuss the fee, and sign a written buyer agreement. Our finding a real estate agent guide helps you vet candidates.
- Shop and make an offer. Your agent helps you write a competitive offer and negotiate.
- Inspection and appraisal. Get the home inspected; your lender orders an appraisal to confirm value.
- Close. Sign the final documents, apply your assistance, and get your keys.
For a fuller stage-by-stage walkthrough, see our home buying process guide.
North Dakota first-time buyer FAQ
How much down payment help can I get in North Dakota?
The DCA program provides assistance equal to 3% of your first mortgage loan amount, or $3,000, whichever is greater, usable for your down payment, closing costs, and prepaid items. On smaller loans, the $3,000 floor guarantees a meaningful minimum. The Start program offers assistance too, so ask your lender which fits your income and loan.
What’s the difference between FirstHome, DCA, and Start?
FirstHome is the mortgage, NDHFA’s below-market-rate loan for first-time buyers. DCA is down payment and closing cost assistance for low-income first-time buyers that pairs with an NDHFA mortgage. Start is a broader program for low- to moderate-income buyers, also with assistance attached. Your lender can tell you which combination you qualify for.
How much of my own money do I need?
For DCA, you must contribute at least $500 from your own cash assets. Beyond that, the assistance can cover much of your down payment, closing costs, and prepaid items. Pairing NDHFA assistance with a low-or-zero-down loan (like USDA or VA) can keep your out-of-pocket cash quite low.
When do I have to finish homebuyer education?
Your homebuyer education certificate must be dated before your loan closes, so complete the course early in the process rather than at the finish line. It’s usually a few hours and often available online, and doing it early also makes everything else clearer.
Is North Dakota good for USDA loans?
Exceptionally so. Nearly all of North Dakota outside the largest cities qualifies as rural under USDA’s map, and USDA loans allow zero down for eligible buyers under the income limits. If you’re buying in a smaller town, pairing a USDA loan with NDHFA assistance can drive your out-of-pocket cash very low. Your lender can run the numbers.
Where do I start?
Start by contacting an NDHFA participating lender and getting pre-approved. That conversation confirms your budget, tells you which programs you qualify for, and lays out your education requirement (which you’ll want to complete early). If you’re comparing states, our states hub has guides for the rest of the country.
Sources: North Dakota Housing Finance Agency / ND Housing (ndhousing.nd.gov), the U.S. Department of Housing and Urban Development (HUD), the U.S. Department of Agriculture (USDA) Rural Development, and the National Association of Realtors (NAR). Program details, income limits, and dollar figures change; confirm current terms with an NDHFA participating lender before relying on them. Last reviewed July 2026.
More North Dakota first-time buyer resources
Ready to go deeper? Our complete guide to North Dakota first-time home buyer programs breaks down every state loan, down payment assistance option, and tax credit available to first-time buyers here.
First-time home buyer grants in North Dakota
Looking specifically for grant money? Our guide to first-time home buyer grants in North Dakota covers which programs are true grants, which are forgivable, and the truth about the widely advertised federal grant.