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SDHDA Housing First-Time Homebuyer Program

The First-time Homebuyer Program by the South Dakota Housing Development Authority (SDHDA) provides low-interest fixed-rate mortgage loans and cash assistance for the down payment and closing costs for homebuyers purchasing their first home.

Who is Eligible

• You are a first-time homebuyer, meaning you have not owned a home in the past three years
  • If a homebuyer owned and lived in a dwelling unit that was not permanently affixed to a permanent foundation (ie; a mobile home), it doesn’t count as previous homeownership
  • Ask your lender about our Veterans Waiver to see if you qualify.
• Have an income at or below the South Dakota Housing Income Limits
• The purchase price must be $300,000 or less

              Maximum Family Income By Family Size

   County                         2 or less             3 or more

• Brookings                   $86,100                 99,015
• Brown                          80,200                  92,230
• Clay                              80,000                  92,000
• Codington                   78,000                  89,700
• Edmunds                     81,900                  94,185
• Faulk                            82,700                  95,105
• Hand                            76,100                  87,515
• Hanson                        79,600                  91,540
• Hughes                        96,300                 110,745
• Hyde                            79,300                  91,195
• Lake                             81,700                  93,955
• Lincoln                        82,500                  94,875
• Marshall                      75,800                  87,170
• McCook                       82,500                  94,875
• Minnehaha                 82,500                  94,875
• Pennington                 76,300                  87,745
• Stanley                        79,900                  91,885
• Sully                             82,400                  94,760
• Turner                         82,500                  94,875
• All other counties      75,500                  86,825
• Repeat buyers or
• in Targeted areas       90,600                105,700

Purchase Limits                  Existing         New Construction

• First-time homebuyers    $300,000           $300,000
• Repeat buyers or
• targeted areas                  $366,000           $366,000

SDHDA’s Tax Credit (MCC)

SDHDA’s Tax Credit is available through a Mortgage Credit Certificate (MCC), which reduces the amount of federal income tax you pay, giving you more disposable income. With SDHDA’s Tax Credit (MCC), a percentage of your mortgage interest can be used as a dollar-for-dollar reduction in your tax bill, and the remaining interest paid is still eligible for the home mortgage interest deduction.

Who Can Apply?

• You are purchasing your first home which means you have not owned a home in the last three years.
• The Maximum home sales price does not exceed the current purchase price limit of $300,000 or if the home is located in a federally designated targeted area, $366,000

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Repeat Homebuyer Program

You’re ready for a change and we’re here to help. Over 75,000 families have trusted us to finance their first home. Now we have a way to help repeat home buyers get into their next home with ease – and for less money out of pocket. Ask your lender about our new Repeat Homebuyer Loan Program and take advantage of this great opportunity.

• Low fixed rate
• Down payment and closing cost assistance
• Reduced mortgage insurance
• Less paperwork

National First-Time Homebuyer Loan Programs

• • FHA Loans – FHA home loans are very popular with first-time homebuyers cause they require a 580 credit score with just a 3.5% down payment. Debt-to-income ratios up to 50% are allowed making them perfect for low-income borrowers.
  • Conventional Loans – Conventional loans require a 620 credit score and a 5% to 20% down payment. If you put 20% or more down, mortgage insurance will not be required.
  • USDA Loans – USDA mortgage loans are for low-to-median income borrowers buying a home located in a USDA-eligible rural area. They provide 100% financing with a 620 or higher credit score. Mortgage insurance is required but the rate is the lowest of any type of mortgage program available.
  • VA Loans – Veterans of the U.S. military may be eligible for a VA home loan. No down payment or mortgage insurance is required and veterans with a 580 to 620 credit score are eligible.
  • HomeReady and Home Possible Loans – Freddie Mac and Fannie Mae created the HomeReady and Home Possible loan programs for low-income first-time homebuyers whose income does not exceed 100% of the area median income requiring just a 3% down payment and a 620 credit score.

Helpful Resources

Statewide Programs

City/County Programs

Getting Started

Buying a Home

Owning and Maintaining Your Home

Other South Dakota Resources