MN SF3897

Appropriates $170,000,000 in fiscal year 2023 to the Housing Finance Agency for a grant to Midwest Minnesota Community Development Corporation (MMCDC) to establish a first-generation homebuyers down payment assistance fund.

Eligible first-generation homebuyers must have income at or below 100 percent of area median income, be first-time homebuyers, be preapproved for a mortgage, have parents who did not own a home, complete homebuyer education, and contribute a minimum of $1,000 to down payment or closing costs.

Assistance is limited to 10 percent of home purchase price, not exceeding $30,000 per borrower, provided as a forgivable loan that forgives 20 percent per year; balance becomes repayable if property is sold, converted to non-owner occupancy, or subjected to foreclosure within five years.

MMCDC administers the statewide fund and may authorize other community development financial institutions, Tribal entities, and nonprofit organizations to originate and service loans; administrative costs cannot exceed $3,000 per loan.

Fund administrator must report annually by January 15 to legislative committees on loan closings, amounts, median values, borrower demographics by race/ethnicity, mortgage types, and geographic distribution; program sunsets July 1, 2025.