Financial News, Home Buying News

South Dakota Housing Development Authority

South Dakota Housing Development Authority Website - go here

The First-time Homebuyer Program provides below-market fixed interest rate mortgage loans and cash assistance for homebuyers purchasing a residence in the state of South Dakota. SDHDA provides the low interest rate by selling tax-exempt Mortgage Revenue Bonds to investors. Participating Lenders originate, process and close the loans. On behalf of SDHDA, five Master Servicers collect mortgage payments and otherwise service the loans. To qualify for a First-time Homebuyer Loan:

You cannot have resided in a home which you own during the previous three years. For the purpose of determining prior homeownership, residing in a dwelling unit that was not permanently affixed to a permanent foundation is not considered prior homeownership. Additionally, Veterans who are second-time homebuyers may qualify under a “Veteran’s Waiver”.
Your total household income cannot exceed the federally-imposed Income Limit for the county in which the property is located.
The purchase price of the home cannot exceed the federally-imposed Purchase Price Limits.
All loans must meet lending standards of creditworthiness and be insured or guaranteed against default by the Federal Housing Administration (FHA), Veteran’s Administration (VA), USDA Rural Development or insured by a private mortgage insurance (PMI) company. Mortgage Insurance is not required if your downpayment is 20% or more.

All single family residences must be owner-occupied, one to four family units. Dwellings with two to four family units cannot have been newly constructed within the last five years.

Income Limits - The Income Limits generally change on an annual basis, usually in the spring of each year. The limits may vary based on the county in which the home is located. Your total gross household income cannot exceed the limits in effect at the time you close on your loan.

Buying a home is one of the most important purchases many people will make. That is why SDHDA strongly recommends individuals attend a Homebuyer Education class before they purchase their first home. Click here for more information on Homebuyer Education.

SDHDA sells tax-exempt Mortgage Revenue Bonds (MRB) to investors in order to finance the First-time Homebuyer Program. These MRBs are subject to federal regulation. These federal regulations require that SDHDA impose both income limits and purchase price limits on First-time Homebuyer Program loans.

Purchase Price Limits

The Purchase Price Limits may or may not change each year. When determining the total purchase price of a home you must include all amounts paid to acquire the home, such as any repair costs, the cost of acquiring the land (if new construction), etc. If you are obtaining the home from a friend, employer or relative (non-arm’s length transaction), the appraised value will be considered to be the purchase price.

The Purchase Price Limits may vary based on the county in which the property is located.

Click here for a printable list of First-time Homebuyer Income and Purchase Price Limits. (.pdf format)