SF1610

This bill modifies the Community-Based First-Generation Homebuyers Assistance Program in Minnesota. It amends previous legislation to refine eligibility criteria, funding use, and administrative processes. Key provisions include:

• Program Administration: The Midwest Minnesota Community Development Corporation (MMCDC) will administer the program, which provides down payment assistance to first-generation homebuyers. The program is available statewide and may be managed by MMCDC in coordination with other entities.

• Eligibility: Applicants must have an income at or below 100% of the statewide median income and either have never owned a home or lost a home due to foreclosure. Additionally, their parent or legal guardian must also have never owned a home or have lost one to foreclosure. Homebuyers must complete an approved homeownership education course.

• Financial Assistance: Eligible homebuyers can receive assistance amounting to 10% of the home's purchase price, up to $32,000. Starting in fiscal year 2027, the maximum assistance may be increased to 10% of the median home price reported in the previous year's Minnesota Realtors Annual Report. The funds are provided as a five-year forgivable no-interest loan, with 20% forgiven each year, provided the homeowner maintains occupancy. If the homeowner sells, rents out, or refinances in an ineligible manner within five years, they must repay the remaining balance.

• Funding and Appropriations: The bill appropriates:

  • $25 million in fiscal year 2026
  • $50 million in fiscal year 2027
    from the general fund to MMCDC for program implementation. Unused funds at the end of each biennium must be returned to the Minnesota Housing Finance Agency for administration of other homeownership development programs.

• Reporting Requirements: By January 15 each year, MMCDC must submit a report to the legislature, providing data on the number and amount of loans issued, demographic breakdowns, home purchase prices, mortgage types, and funds returned to the program.

This bill aims to promote homeownership among first-generation buyers who face financial barriers, particularly those from communities historically disadvantaged in homeownership opportunities.