Buying your first home in Stillwater should feel exciting, not overwhelming. If you are wondering how to cover your down payment or which loan fits your budget, you are not alone. The good news is that Washington County buyers have several first-time programs to help you get the keys sooner. In this guide, you will learn which programs to consider, how eligibility works, and the exact steps to apply. Let’s dive in.
Key programs for Stillwater buyers
Several options can reduce your upfront costs and monthly payment:
- State assistance through Minnesota Housing paired with a first mortgage.
- Federal mortgages like FHA, USDA, VA, and conventional 3 percent down options.
- Possible county or city HRA/CDA down payment help when funds are available.
- Required or recommended homebuyer education from a HUD-approved counselor.
Each program has its own rules on income, price limits, credit, and property type. Your lender and a housing counselor can help you match programs to your goals.
Minnesota Housing basics
Minnesota Housing offers first mortgages that can be paired with down payment and closing cost assistance. Programs have income and purchase-price limits that are updated regularly. Review current details and participating lenders on the official Minnesota Housing programs page.
What to know before you apply:
- Many products use the three-year first-time buyer definition.
- Assistance may come as a deferred or forgivable second loan.
- Most options require an approved homebuyer education course.
Federal loan options to compare
Several national programs work well for first-time buyers in Washington County:
- FHA loans: 3.5 percent minimum down payment, flexible credit, and required mortgage insurance. Learn more about FHA through HUD.
- USDA Rural Development loans: 100 percent financing in eligible areas with income limits. Check programs and mapping tools at USDA Rural Development.
- VA loans: Zero-down options for eligible service members and veterans. Get eligibility guidance from VA home loans.
- Conventional 3 percent down: Explore Fannie Mae HomeReady and Freddie Mac Home Possible for low-down-payment conventional loans with potential mortgage insurance savings.
Local HRA and city resources
Washington County and some cities may offer seasonal or targeted down payment assistance through their HRA or community development programs. Availability changes based on funding. Search the Washington County government website and the City of Stillwater site for housing or HRA pages, or call to ask about current offerings and timelines.
Local nonprofits and community action agencies also host education workshops and counseling. If you need a starting point, use HUD’s tool to locate a HUD-approved housing counselor near Stillwater.
Who qualifies and how limits work
Most first-time programs share common eligibility themes:
- First-time buyer status: Usually means no homeownership in the past three years.
- Income limits: Vary by county and household size. Check the latest tables through HUD User income limits and Minnesota Housing.
- Purchase-price caps: Set by program and updated regularly for Washington County.
- Property rules: Primary residence only, with specific standards for condos and manufactured homes.
- Underwriting: Minimum credit score and debt-to-income ratios depend on the loan type and lender.
Property checks in Stillwater
If you are shopping near the St. Croix River, verify floodplain status early. Federally backed loans may require flood insurance in mapped flood zones. Use the FEMA Flood Map Service Center to check a property’s flood risk before you write an offer. Also ask your agent if any local historic or conservation guidelines could affect future renovations.
How to apply step by step
Follow this simple path to keep your purchase on track:
- Meet a lender and request a full pre-qualification. Ask if they originate Minnesota Housing loans and work with FHA, USDA, VA, and HomeReady/Home Possible.
- Complete homebuyer education if required. A certificate from a HUD-approved counselor is commonly accepted.
- Confirm program eligibility and reserve funds where needed. Some local DPAs have limited budgets or wait lists.
- Start house hunting with program rules in mind. Confirm that your target property type is eligible for your loan.
- Submit your mortgage application and provide documents. Expect 21 to 45 days for underwriting.
- Close on your loan and sign any second-loan or grant paperwork tied to assistance.
What documents to gather
Have these ready to speed things up:
- Government-issued photo ID and Social Security numbers
- Last 30 days of pay stubs and employer contact
- Two years of W-2s and tax returns
- Two to three months of bank and asset statements
- Homebuyer education certificate, if required
- Signed purchase agreement and seller disclosures
Smart ways to combine programs
You can often pair a Minnesota Housing first mortgage with its down payment assistance. Many buyers also use FHA, VA, or conventional loans with state assistance when allowed. Some municipal or nonprofit DPAs layer with state or federal loans, but others do not. Always confirm layering rules, repayment terms, and any forgiveness schedule before you commit.
Common pitfalls to avoid
- Missing income or price caps: Use current Minnesota Housing and HUD tables for Washington County.
- Assuming condo or manufactured home eligibility: Check lender and program requirements early.
- Overlooking flood insurance: A mapped floodplain can raise your monthly costs.
- Waiting on limited funds: Local DPA dollars can run out. Apply as soon as you are eligible.
- Not reading DPA terms: Some assistance is deferred until sale or refinance, and some forgives over time.
What this means for your budget
First-time buyer programs can lower your upfront cash and improve monthly affordability. FHA may be the most flexible on credit, while HomeReady or Home Possible could reduce long-term insurance costs if you qualify. USDA or VA can minimize your down payment if your property and status are eligible. A quick side-by-side with your lender will clarify the lowest total cost over time.
Your next move in Stillwater
If you are ready to explore Stillwater homes and want a clear plan for financing, connect with a trusted advisor and a lender who knows these programs well. Our team can help you focus your search, flag floodplain or historic considerations, and coordinate with lenders and counselors so your purchase stays on track. When you are ready for a smooth first purchase in Washington County, reach out to the Cascade Group Lakes Sotheby’s International Realty to start a plan that fits your goals.
Ready to talk through your options and next steps? Contact the Cascade Group Lakes Sotheby’s International Realty to Schedule a Consultation.
FAQs
What first-time buyer programs serve Stillwater buyers?
- Minnesota Housing first mortgages with down payment assistance, FHA, USDA, VA, and conventional 3 percent down options like HomeReady and Home Possible.
How do income and price limits work in Washington County?
- Programs set income and purchase-price caps that update annually, so verify current numbers through Minnesota Housing and HUD User income limits.
Can I combine Minnesota Housing assistance with FHA?
- Many buyers pair Minnesota Housing down payment assistance with FHA or conventional loans, but layering rules vary by product, so confirm with your lender.
Is USDA financing available in the Stillwater area?
- USDA eligibility depends on property location and household income; check address eligibility and program rules at USDA Rural Development.
Do I need a homebuyer education class to qualify?
- Many state and local programs require a certificate from a HUD-approved housing counselor or an approved course before closing.
How long does buying with assistance usually take?
- From offer to closing, plan for roughly 30 to 60 days, with time upfront to verify eligibility and reserve any limited down payment funds.
