Get ready, be ready: Empowering community members to pursue their homeownership dreams

It is no secret that homeownership is a key component to building lasting generational wealth. It is also well documented that Black, Indigenous and people of color (BIPOC) communities have historically been held back from these homeownership opportunities, often through systemic actions such as redlining or discriminatory zoning practices.

That is why, as VP, Community Impact Manager at Bremer Bank, where my daily responsibilities include educating and empowering community members to pursue their dreams of homeownership, I regularly recommend two first-time homebuyer programs coming online later this spring, particularly for families of color: The First-Generation Homebuyer Loan Program and the First-Generation Homebuyers Down Payment Assistance Fund . Both serve as an important first step in opening the door to more first-time homebuyers, many of them the first in their family to own a home, by providing down payment assistance to anyone who has never owned a home.

Offering homebuyers up to $35,000 for use in down payment assistance or to cover closing costs, the First-Generation Homebuyer Loan Program can be paired with other Minnesota Housing programs . The loan is durable and interest-free, with half forgivable at 10 years and the remaining balance forgiven after 20 years. This loan functions similarly to the First-Generation Homebuyers Down Payment Assistance Fund – a historic $100 million passed by the Minnesota Legislature in 2023, earmarked for spending on programs to make homeownership more affordable for more Minnesotans. This fund awards loans of up to $32,000 or 10% of the purchase price, whichever is less, to homebuyers for a down payment and is forgivable over the first five years of owning and living in the home.

?

Together, these two programs are powerful tools for first-time, first-generation homebuyers who, because of Minnesota’s racial homeownership gap , are oftentimes also homebuyers of color. These tools are even more powerful when paired with homebuyer education! The Minnesota Homeownership Center's Home Stretch course is an excellent option. Any time I work with first-time homebuyers navigating down payment assistance programs, I encourage them to seek further education opportunities in addition to the course each loan program requires of applicants. Doing so helps correct misinformation around the homebuying process and common misconceptions about perceived indicators of financial readiness, alleviating anxieties and helping people feel more prepared.

?

It also helps future homeowners understand how building true generational wealth goes beyond the initial purchase of a home. We need to be better at educating potential homebuyers on all the costs they’ll incur, and not just the initial downpayment and closing fees. While each home’s maintenance costs will vary, every house will still have its own set of extra expenses to account for. If we are not upfront about these costs in the initial planning phase, then it is significantly more difficult for people to make informed decisions about selecting a home that fits within their budget and lifestyle.

?

My advice to the first-time homebuyer who qualifies for these loan programs? Get ready now to be ready later.

1. Understand the five elements of your mortgage costs . This includes your downpayment, lender fees, title company fees, escrow funds and administration fees. This will help you anticipate what your final monthly mortgage cost will look like.
2. Meet with a mortgage lender. Or, if you have challenging credit, meet with a nonprofit partner like Project for Pride in Living to explore the homebuying options available to you.
3. Consult before you apply. Once you’ve contacted a mortgage lender, have them do an initial consultation. Understand the many products, programs and mortgage loan options available to you.

?

Buying your first home is a huge life milestone, especially if you are the first person in your family to do so. At Bremer Bank, we understand the deep financial and emotional impact this milestone can have. As a bank centered in cultivating thriving communities, we see firsthand the direct difference that is made when we truly show up and walk the talk, working closely with each community member to inform and empower them to eventual homeownership. Whether it’s a month from now or years from now, we will be here to help you get ready and be ready for the next chapter.