​Since 1998, the Sioux Falls Homebuyer Assistance Program has helped low- and moderate-income individuals by providing assistance with the down payment and closing costs associated with the buying a new home. Assistance comes in the form of zero-interest, deferred loans.

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Sioux Falls Homebuyer Assistance Program

Financial Assistance for Homebuyers in South Dakota

Since 1998, the Sioux Falls Homebuyer Assistance Program has helped hundreds of applicants achieve their dreams of homeownership. The program assists low- and moderate-income individuals by providing assistance with the down payment and closing costs associated with the buying a new home.

Assistance funds for eligible households come in the form of zero-interest, deferred loans. It is only repayable (without interest) when borrowers choose to sell their home, or no longer use it as their primary residence. The maximum loan amount granted is $5,000.

Eligibility Requirements
In order to be considered eligible for the Sioux Falls Homebuyer Assistance Program, all applicants need to meet the following requirements:
  • The annual income (income of all household members from all sources before taxes and withholding, including child support) must fall under 80 percent of the AMI.
  • All applicants must be first-time homebuyers (cannot have owned a home in the previous three years). Exceptions are made in the case of displaced homemakers, households living in manufactured housing, and households living in housing not feasible for rehabilitation.
  • All applicants have to be current with their financial obligations, and have a history of being financially responsible. If individuals have been disapproved for not meeting this requirement, they may reapply six months after repaying all debts, or six months after denial of the first application, whichever occurs later.
  • Borrowers must be secure a fixed-rate first mortgage from a commercial lender, with an interest rate not more than 1.5 percentage points above the current fixed rate of South Dakota Housing’s First-Time Homebuyer Program.
  • Applicants with a debt ratio of more than 43 percent, and housing expense ratio of more than 31 percent of their income are not eligible.
  • Applicants’ cash assets at the time of closing cannot exceed $10,000, and they must be able to contribute at least $500 toward the transaction.
  • All borrowers must complete a homebuyer education administered by the Homeownership Education Resource Organization (HERO).
The Sioux Falls Homebuyer Assistance Program is only applicable in cases where the borrower is purchasing a single-family detached home affixed to a permanent foundation in the designated program area, not exceeding the purchase price of $137,000. These homes must be inspected by an independent home inspection business licensed or registered by the State of South Dakota.

Down Payment Grants in South Dakota

The First-time Homebuyer Program provides low interest fixed rate mortgage loans and cash assistance for homebuyers purchasing their first home. To qualify for the program, applicants must not have owned a home in the past three years. 

The South Dakota Housing Development Authority offers the Fixed Rate Plus Option Program to help  cover some or all of the down payment and closing costs associated with a mortgage transaction. It  provides eligible applicants with assistance up to 3 percent of the loan amount. 

South Dakota’s Homes Are Possible Inc. (HAPI) acknowledges that potential homebuyers able to make the monthly payments on a new home may not have enough saved for a down payment. That’s why HAPI currently offers a $3,500 non-forgivable loan as Down Payment/Closing Cost Assistance for Brown County.

​Since 1998, the Sioux Falls Homebuyer Assistance Program has helped low- and moderate-income individuals by providing assistance with the down payment and closing costs associated with the buying a new home. Assistance comes in the form of zero-interest, deferred loans.

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