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Minnetonka Down Payment Assistance Deferred Loan

Minnetonka Economic Development Authority (EDA); administered by Center for Energy and Environment (CEE) · Minnetonka, Minnesota

Last verified
See what you qualify forOfficial program site →
Assistance

$50,000

The maximum the program publishes — not an offer

Income limit

120% AMI

Of area median income; varies by county and household size

Price cap

$500,000

Highest purchase price the program allows

Repayment

Forgivable

Forgiven after 30 years

What is Minnetonka Down Payment Assistance Deferred Loan?

Minnetonka Down Payment Assistance Deferred Loan is a deferred second loan for homebuyers in Minnetonka, Minnesota, administered by Minnetonka Economic Development Authority (EDA); administered by Center for Energy and Environment (CEE).

  • A 0% fixed-rate deferred second-lien down payment and closing cost assistance loan funded by the City of Minnetonka and its EDA and administered by CEE. The loan equals 10% of the purchase price up to $50,000, requires a 1% minimum borrower contribution, is deferred for 30 years, and is 100% forgiven if the borrower retains the home as a primary residence for the full term. Income (120% AMI) and asset ($25,000) limits apply. Distinct from Minnetonka Pathways to Homeownership and the West Hennepin land trust's Homes Within Reach program.
  • 0% APR fixed-rate.
  • Fully deferred, forgiven at 30 years.
  • Up to $50,000.
  • No monthly payments.
  • No prepayment penalty.
  • Funding comes from City of Minnetonka and its Economic Development Authority.

How much assistance does it provide?

Minnetonka Down Payment Assistance Deferred Loan offers up to $50,000 in assistance.

  • Buyer contribution: Homebuyer must contribute at least 1% of the total purchase price from own funds or gift funds.
  • Amounts are the program's published maximums, not an offer — Minnetonka Economic Development Authority (EDA); administered by Center for Energy and Environment (CEE) determines any individual award.

Do you have to pay it back?

Minnetonka Down Payment Assistance Deferred Loan is forgiven after 30 years, so a buyer who stays that long does not repay it.

  • Repayment is triggered by Entire principal due upon sale, transfer of title, loss of primary residence, or refinance before the 30-year anniversary; 100% forgiven at 30 years.
  • The assistance is recorded in Subordinate (mortgage in favor of the Minnetonka EDA; junior to first mortgage) position.
  • Forgiveness and repayment terms are set by the program and can change — confirm them on the official program page before applying.

Who qualifies?

Minnetonka Down Payment Assistance Deferred Loan is open to buyers who will live in the home as their primary residence.

The program requires

  • The home is occupied as a primary residence
  • On credit: No numeric minimum; borrower must show mortgage approval and acceptable credit history per CEE underwriting.
  • A completed homebuyer education course, through HUD-approved homebuyer education; Home Stretch (or other HUD-approved program); certificate prior to closing.
  • Residency: Property within the City of Minnetonka.
  • Citizenship or immigration status: All borrowers must be legal residents of the U.S. with a SSN (citizens, permanent and non-permanent resident aliens). ITINs not acceptable; foreign nationals and non-occupant co-borrowers ineligible.
  • DRAFT (dpa-gap-finder 2026-06-12): pending review. Signed purchase agreement and application at least four weeks (28 days) before closing; property must be homesteaded; borrower may not own a second property; asset verification required; HUD-approved homebuyer education for all borrowers; first mortgage must be fixed-rate.

The program excludes

  • Manufactured homes
  • Purchases above the $500,000 price cap
  • Households above 120% of area median income

These are the program's own published rules, not a decision about any individual — the administering agency and a lender determine who actually qualifies.

What are the income limits?

Minnetonka Down Payment Assistance Deferred Loan limits household income to 120% of the area median income, which varies by county and household size.

  • Total gross annual household income cannot exceed 120% of AMI based on household size (HUD, adjusted annually).
  • The limit applies to total household income, not only the borrower’s.
  • Area median income figures are published by HUD and updated annually, so check the current table for the county before relying on a number.

What kind of home can it be used for?

Minnetonka Down Payment Assistance Deferred Loan caps the purchase price at $500,000.

  • Eligible property types include Single Family, Townhouse, and Condo.
  • Manufactured homes are not eligible.

Where does it apply?

Minnetonka Down Payment Assistance Deferred Loan serves buyers purchasing in Minnetonka, Minnesota.

How do you apply?

Applications for Minnetonka Down Payment Assistance Deferred Loan go through Minnetonka Economic Development Authority (EDA); administered by Center for Energy and Environment (CEE), which publishes the current terms and the application steps on its own site.

  1. Take a homebuyer education course

    Required by the program, through HUD-approved homebuyer education; Home Stretch (or other HUD-approved program); certificate prior to closing..

  2. Contact Minnetonka Economic Development Authority (EDA); administered by Center for Energy and Environment (CEE) to reserve funds

    Funds are reserved through First-come, first-served; application with signed purchase agreement at least four weeks (28 days) before closing., and are subject to availability.

  3. Work with a lender who handles the program

    Hey Prescott is not a lender and does not accept applications; this page describes the program so a buyer can take it to a lender or housing counselor.

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