SDHDA announces new options for First-Time and Repeat Homebuyers
PIERRE – South Dakota Housing Development Authority (SDHDA) is announcing two exciting changes that will provide both first-time and repeat homebuyers with additional opportunities to achieve their dream of buying a new home.
It is currently a seller’s market in many South Dakota communities, as low inventory is causing housing prices to skyrocket. However, interest rates remain at an all-time low, making it a great time to buy for many. In an effort to provide additional assistance to buyers, SDHDA is now offering two new enhancements to its mortgage programs: elimination of an origination fee and additional downpayment assistance.
Effective with all loan commitments dated on or after May 14, 2021, the 1% SDHDA origination fee will be waived. For example, on a $200,000 loan, an origination fee of 1% would be $2,000. This change will allow borrowers to pay less in upfront closing costs.
In addition, SDHDA will be providing borrowers an additional option for the Fixed Rate Plus loan. Currently, borrowers are eligible for a loan that equals 3% of the first mortgage amount for downpayment and closing costs assistance. After May 14, 2021, a loan option that equals 5% of the mortgage will be available, in addition to the 3% option. Some borrowers may need the additional funds to fill the gap created by the seller’s market.
The elimination of the 1% origination fee and the additional Fixed Rate Plus loan option are intended to make it easier for borrowers to come up with the required downpayment and closing costs.
Borrowers must meet certain qualification requirements, including income and purchase price restrictions. The income limits vary by county and can be found on SDHDA’s website.
Homebuyers interested in assistance can begin the application process by visiting a lender offering SDHDA homebuyer products. A list of participating lenders can be found on sdhda.org or by calling 800.540.4241.
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May 28, 2021