Local Program
Watertown First-Time Homebuyer Program | South Dakota Hou...
Watertown First-Time Homebuyer Program offers affordable financing and varies to help South Dakotans purchase, repair, or stabilize housing.
Program Details
**Watertown First-Time Homebuyer Program** is administered by the local housing office to promote affordable
homeownership, rehabilitation, or rental stability throughout South Dakota. The program combines fixed‑rate
first mortgages with down‑payment assistance, tax credits, or forgivable loans such as the Community Home
Improvement Program (CHIP). Borrowers benefit from statewide HUD‑approved education courses, post‑purchase
budget coaching, and foreclosure‑prevention resources. Funds are accessed through a network of
SDHDA‑participating lenders or municipal housing departments on a first‑come, first‑served basis. Properties
must meet South Dakota housing‑quality standards, and rehabilitation draws are inspected prior to payment to
safeguard workmanship. Rural borrowers may layer USDA 502 financing, while urban applicants can combine
Neighborhood Stabilization Program grants for targeted revitalization areas.
homeownership, rehabilitation, or rental stability throughout South Dakota. The program combines fixed‑rate
first mortgages with down‑payment assistance, tax credits, or forgivable loans such as the Community Home
Improvement Program (CHIP). Borrowers benefit from statewide HUD‑approved education courses, post‑purchase
budget coaching, and foreclosure‑prevention resources. Funds are accessed through a network of
SDHDA‑participating lenders or municipal housing departments on a first‑come, first‑served basis. Properties
must meet South Dakota housing‑quality standards, and rehabilitation draws are inspected prior to payment to
safeguard workmanship. Rural borrowers may layer USDA 502 financing, while urban applicants can combine
Neighborhood Stabilization Program grants for targeted revitalization areas.
Eligibility Requirements
- U.S. citizen, permanent resident, or qualifying non‑citizen.
- Household income ≤ SDHDA county limits (e.g., $105,000 for a family of four in Minnehaha County, 2025).
- Purchase‑price cap aligned with FHA/USDA limits or $400,000, whichever is lower.
- Minimum 620 credit score (680 for conventional loans).
- Debt‑to‑income ratio ≤ 45 % (up to 50 % with compensating factors).
- Completion of HUD‑approved homebuyer education and SDHDA counseling.
- Household income ≤ SDHDA county limits (e.g., $105,000 for a family of four in Minnehaha County, 2025).
- Purchase‑price cap aligned with FHA/USDA limits or $400,000, whichever is lower.
- Minimum 620 credit score (680 for conventional loans).
- Debt‑to‑income ratio ≤ 45 % (up to 50 % with compensating factors).
- Completion of HUD‑approved homebuyer education and SDHDA counseling.
Program Benefits
- **Varies** applied toward down payment, closing costs, or rehab escrow.
- 30‑year fixed‑rate mortgage at below‑market interest.
- Forgivable assistance after five years of owner occupancy (for programs like Fixed Rate Plus).
- Eligibility for Mortgage Credit Certificates to reduce federal tax liability.
- Access to SDHDA foreclosure‑prevention hotline and homeowner resources.
- 30‑year fixed‑rate mortgage at below‑market interest.
- Forgivable assistance after five years of owner occupancy (for programs like Fixed Rate Plus).
- Eligibility for Mortgage Credit Certificates to reduce federal tax liability.
- Access to SDHDA foreclosure‑prevention hotline and homeowner resources.
How to Apply
1. **Pre‑approval:** Engage an SDHDA‑approved lender; review credit and income.
2. **Education:** Complete HUD‑certified homebuyer course; receive certificate.
3. **Reserve funds:** Lender locks SDHDA rate and requests assistance funds.
4. **Underwriting & appraisal:** Provide documentation and undergo property inspection.
5. **Closing:** Sign first‑mortgage and subordinate‑lien documents; receive funds.
6. **Post‑purchase:** Move in within 60 days; comply with occupancy and forgiveness terms.
2. **Education:** Complete HUD‑certified homebuyer course; receive certificate.
3. **Reserve funds:** Lender locks SDHDA rate and requests assistance funds.
4. **Underwriting & appraisal:** Provide documentation and undergo property inspection.
5. **Closing:** Sign first‑mortgage and subordinate‑lien documents; receive funds.
6. **Post‑purchase:** Move in within 60 days; comply with occupancy and forgiveness terms.
Program Overview
Category
Local Program
Official Program Website
Information about this program is provided as a resource and may be subject to change. Always verify details with the official program website.
Important Note
Program availability, terms, and requirements may vary by lender and location. Additionally, programs are subject to change based on policy updates and market conditions. Always consult with a mortgage professional for the most current information and to determine eligibility for specific programs.