See programs you qualify for
Get Matched Free →By Tyler Thompson · Licensed Real Estate Agent · Updated May 5, 2026
Homebuyer Programs in Cottage Grove, MN (2026)
Cottage Grove is a southeast Twin Cities suburb of about 41,000 residents in Washington County, sitting along the Mississippi River. The median home price is near 0,000. Cottage Grove does not run its own city-funded down payment assistance program, so buyers rely on Washington County, state, federal, and nonprofit options. The Washington County CDA partners with Minnesota Housing on the Start Up first-time homebuyer program and offers a ,000 First-Generation Homebuyer Grant for eligible buyers, plus free homebuyer advising and HomeStretch education. Habitat for Humanity of Washington County builds affordable homes throughout the county. Layer in state programs like the Minnesota Housing Deferred Payment Loan (up to ,500), Monthly Payment Loan (up to ,000), and First-Generation Loan (up to ,000), plus nonprofit options like Twin Cities Habitat, Welcome Home DPA, and Community Keys Plus, and federal programs like FHA and VA round out the toolkit.
County Programs in Washington County
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| Washington County CDA First-Generation Homebuyer Grant | Grant | — | Yes | View → |
- Type:
- Grant
- First-time only:
- Yes
State Programs in Minnesota
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| Minnesota First-Generation Homebuyer Loan Program | Deferred Loan | — | Yes | View → |
| Minnesota Housing Deferred Payment Loan | Deferred Loan | — | Yes | View → |
| Minnesota Housing Monthly Payment Loan | Repayable Loan | — | No | View → |
| Minnesota Housing Start Up Program | Government-Insured Mortgage | First mortgage with as little as 3% down | Yes | View → |
| Minnesota Housing Step Up Program | Government-Insured Mortgage | First mortgage; can also be used to refinance | No | View → |
- Type:
- Deferred Loan
- First-time only:
- Yes
- Type:
- Deferred Loan
- First-time only:
- Yes
- Type:
- Repayable Loan
- First-time only:
- No
- Type:
- Government-Insured Mortgage
- Amount:
- First mortgage with as little as 3% down
- First-time only:
- Yes
- Type:
- Government-Insured Mortgage
- Amount:
- First mortgage; can also be used to refinance
- First-time only:
- No
Federal Programs
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| FHA Loans | Government-Insured Mortgage | Up to FHA county loan limits ($541,287 floor to $1,249,125 ceiling for single-family in 2026) | No | View → |
| Good Neighbor Next Door (HUD) | Government Property Sale Program | 50% discount off the list price of HUD-owned homes | Yes | View → |
| Home Possible Mortgage (Freddie Mac) | Government-Guaranteed Mortgage | Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment | No | View → |
| HomeReady Mortgage (Fannie Mae) | Government-Guaranteed Mortgage | Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment | No | View → |
| HUD $100 Down Program | FHA-Financed HUD REO Purchase | Only $100 down payment required (vs. standard 3.5% FHA down payment). HUD may also pay up to 3% of buyer's closing costs. | No | View → |
| USDA Rural Development Loans | Government-Guaranteed Mortgage | 100% financing (no down payment required); loan amount up to appraised value | No | View → |
| VA Loans | Government-Guaranteed Mortgage | No loan limit for veterans with full entitlement (0% down at any price); partial entitlement subject to conforming limits ($832,750 standard in 2026) | No | View → |
- Type:
- Government-Insured Mortgage
- Amount:
- Up to FHA county loan limits ($541,287 floor to $1,249,125 ceiling for single-family in 2026)
- First-time only:
- No
- Type:
- Government Property Sale Program
- Amount:
- 50% discount off the list price of HUD-owned homes
- First-time only:
- Yes
- Type:
- Government-Guaranteed Mortgage
- Amount:
- Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment
- First-time only:
- No
- Type:
- Government-Guaranteed Mortgage
- Amount:
- Up to conforming loan limits ($832,750 standard / $1,249,125 high-cost in 2026); 3% minimum down payment
- First-time only:
- No
- Type:
- FHA-Financed HUD REO Purchase
- Amount:
- Only $100 down payment required (vs. standard 3.5% FHA down payment). HUD may also pay up to 3% of buyer's closing costs.
- First-time only:
- No
- Type:
- Government-Guaranteed Mortgage
- Amount:
- 100% financing (no down payment required); loan amount up to appraised value
- First-time only:
- No
- Type:
- Government-Guaranteed Mortgage
- Amount:
- No loan limit for veterans with full entitlement (0% down at any price); partial entitlement subject to conforming limits ($832,750 standard in 2026)
- First-time only:
- No
Nonprofit Programs
| Program Name | Type | Amount | First-Time Only | Details |
|---|---|---|---|---|
| Community Keys Plus Impact Down Payment Assistance | Deferred Loan | — | No | View → |
| Habitat for Humanity of Washington County (MN) Homeownership Program | Repayable Loan | Affordable mortgage on a Habitat-built or Habitat-renovated home; sweat equity required | Yes | View → |
| Twin Cities Habitat for Humanity Homeownership Program | Repayable Loan | Affordable mortgage with monthly payments at or below 30% of household income; option to use TruePath Mortgage on the open market or purchase a Habitat-built or Habitat-renovated home | No | View → |
| Welcome Home Down Payment Assistance | Forgivable Loan | Varies by household need | Yes | View → |
- Type:
- Deferred Loan
- First-time only:
- No
- Type:
- Repayable Loan
- Amount:
- Affordable mortgage on a Habitat-built or Habitat-renovated home; sweat equity required
- First-time only:
- Yes
- Type:
- Repayable Loan
- Amount:
- Affordable mortgage with monthly payments at or below 30% of household income; option to use TruePath Mortgage on the open market or purchase a Habitat-built or Habitat-renovated home
- First-time only:
- No
- Type:
- Forgivable Loan
- Amount:
- Varies by household need
- First-time only:
- Yes
How to Apply
Step 1: Confirm your eligibility for state programs and the Washington County CDA First-Generation Grant if you qualify (neither you nor your parents have previously owned a home).
Step 2: Contact the Washington County CDA homeownership team at 651-202-2822 to schedule a FREE homebuyer advising appointment. The CDA also runs the HomeStretch education workshop required to access partner programs.
Step 3: Get pre-approved with a Minnesota Housing approved lender. Use the lender directory at mnhousing.gov to layer the Start Up first mortgage with the Deferred Payment Loan or Monthly Payment Loan.
Step 4: If eligible, ask your lender about the Minnesota First-Generation Homebuyer Loan, which can provide up to ,000 in deferred, forgivable assistance — and stack the Washington County CDA's ,000 First-Generation Grant on top.
Step 5: Find a home located within the City of Cottage Grove that fits your budget and program requirements.
Step 6: If you are open to a Habitat home, contact Habitat for Humanity of Washington County. They build throughout Washington County, including Cottage Grove area builds.
Step 7: Submit your final application package and complete underwriting. Coordinate timing between your first mortgage closing and any layered assistance.
Step 8: Close on your home and occupy it as your primary residence.
Frequently Asked Questions
How much down payment assistance can I get in Cottage Grove?+−
Does Cottage Grove have its own city DPA program?+−
Do I have to be a first-time homebuyer?+−
What homebuyer education is required?+−
Can Habitat for Humanity help me buy in Cottage Grove?+−
How much is the Washington County CDA First-Generation Grant worth?+−
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