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North Dakota First-Time Homebuyer Programs

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Ten years ago, when the oil business was booming, housing was in short supply in North Dakota.

Today, thanks in part to the state’s responses and the decline in the energy boom — the North Dakota housing market is much more plentiful. That means first-time homebuyers have more options, and there are several programs available to help make it even easier for them to find their first home.

North Dakota first-time homebuyer programs

If you are a North Dakota resident looking to buy your first home, the North Dakota Housing Finance Agency (NDHFA) can offer assistance with down payments, closing costs and more. Private-sector lenders originate loans on NDHFA’s behalf. After the loan’s close, the agency buys them.

You can check current mortgage rates in North Dakota here.

FirstHome

Features:

  • Mortgage loans to low- and moderate-income buyers
  • Allows purchasers to consider single-family homes, manufactured homes on a permanent foundation, approved condos and 2-4 unit multifamily properties as long as the borrower lives in one
  • Rural properties up to 10 acres can be purchased as long as the buyer’s principal residence is included

Eligibility

  • Buyers can qualify if they haven’t owned a home in the past three years. (Owning a manufactured home on a non-permanent foundation doesn’t count.)
  • You must meet credit underwriting standards. A credit score of 620 is considered the minimum.
  • The property must be your principal residence.
  • You must have a minimum of $500 in cash.
  • Buyers must meet the income limits for the area in which they are purchasing. For families of three or fewer, an income in the capital, Bismarck, can be as high as $96,600. Other areas have lower limits.
  • The price of the property must be within program limits based on location. The price in the Bismarck area for both new and previously occupied homes can be as much as $284,823 for single-unit properties.

How it works

Participating lenders handle all the application and underwriting details. Even before you locate a house, the first step is to find a participating lender that will help determine how much you can afford.

DCA

Features

  • Program provides down payment and closing cost assistance.
  • DCA loans are equal to 3% of the full mortgage amount.
  • During the first eight years of the mortgage, the prorated balance must be repaid if the home is sold, refinanced or otherwise transferred. At the end of that time, if the buyer still lives in the house and pays the mortgage satisfactorily, the DCA portion of the loan will be forgiven.

Eligibility

  • Borrowers must meet income limits
  • DCA cannot be used in conjunction with other down payment assistance programs
  • The home can’t be located within a 100-year flood plain, which means buyers would need to carry federal flood insurance
  • Borrowers must complete a homebuyer education course and receive a certificate of completion that is dated before the loan closing

How it works

You can apply for DCA assistance through one of NDHFA’s participating lenders.

HomeAccess

Features

  • Program offers homebuying assistance for lower-income residents or households with special challenges.
  • Applicants don’t have to be first-time homebuyers, but first-time buyers can benefit.

Eligibility

  • Applicant families must include at least one of these members: a single parent, a veteran or someone who is disabled or over 65.
  • Income limitations are based on the size of your family and where you live.
  • Single-parent borrowers must have a child living in the home at least half the time.
  • Veterans must be released from service for some reason other than a dishonorable discharge.
  • Older or disabled family members must live in the home.
  • Disabled family members must be permanently disabled.
  • Purchase prices for both new and used homes must be within program limits.
  • You must make this property your personal residence, have at least $500 in cash and meet normal income and credit standards.

How it works

You can apply for DCA assistance through one of NDHFA’s participating lenders.

Targeted area loans

Features

  • Because NDHFA issues tax-exempt mortgage revenue bonds, the IRS requires it to set aside a certain number of properties for lower-income homebuyers.
  • Applicants don’t have to be first-time homebuyers, but first-time buyers can benefit.

Eligibility

  • Buyers must earn no more than the program limit.
  • Buyers must find a property in a target area. The best way to find one is to search by address using this search engine and determine the corresponding census tract number for the house you are interested in. The tract number must match one of the included areas below:
    • Benson County: 9401
    • McKenzie County: 9401
    • Rolette County: 9418
    • Sioux County: 9409
  • You must make this property your personal residence, have at least $500 in cash and meet normal income and credit standards.

How it works

You can apply for DCA assistance through one of NDHFA’s participating lenders.

National first-time homebuyer programs

Besides these state-specific programs, there are federal and nonprofit-sponsored programs that provide low-rate mortgages, assistance with purchasing and even opportunities for sweat equity in North Dakota. Habitat for Humanity is very active in North Dakota, and the USDA offers lending assistance in some areas of the state. See our guide to national homebuyer programs for more information.

 

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