Loan Assistance Program (LAP)
Program Description
The Loan Assistance Program (LAP) provides downpayment, closing cost assistance and gap financing in connection with a home purchase financed by a first mortgage loan through an approved South Dakota Housing Development Authority (SDHDA) Participating Lender. The loan term ranges from 5 years to 10 years and the loan amount ranges from $2,000 to $10,000.
Income Limits and Maximum Loan Amounts
The borrower's gross annual income may not exceed certain income limits (80% of area median income) which vary based on family size and the county in which the home is located.
Printable List of Income Limits for Downpayment Programs
(.pdf format)
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Purchase Price Limits
There are no purchase price limits with this program.
Interest Rates
SDHDA offers one interest rate, currently at 5%.
Additional Information
The Minimum Borrower Investment must be $500 with no cash back to the borrower at closing and the Maximum Liquid Assets must not exceed $2,000 after loan closing. There is an SDHDA processing fee of $150 and Homebuyer Education is required through a Homeownership Education Resource Organization (H.E.R.O.) approved service provider.
Funding Source
Member banks contribute to the revolving loan fund administered by SDHDA. From that pool of funds, Participating Lenders will help families with the home buying process in the form of downpayment, closing cost, and gap financing assistance.
How to Apply
Contact one of SDHDA's Participating Lenders for an application.
