The Property Side, Starting With Flood Zones
Program and regulatory figures verified September 26, 2026. Details change; confirm your scenario with us.
In a state shaped by two major rivers, the flood-zone rule is the property constraint most likely to end a deal, and it is the one least often mentioned.
Flood zones A and V
Cornerstone's approved lender guidance for MHDC states it without qualification: all variations of properties located within flood zones A and V are ineligible.
"All variations" is the phrase to notice. Zone A has a number of sub-designations, and the rule reaches them.
Missouri sits at the confluence of the Missouri and the Mississippi. There is real housing inventory in and near mapped flood zones in St. Louis County, along the Meramec, in the Bootheel, and in river towns up and down both systems. This is not a theoretical constraint.
Check the flood zone before you fall in love with a house, not after. The lookup takes a minute and costs nothing, and it is far less painful than finding out during underwriting.
What you can buy
| Property type | Eligible |
|---|---|
| Single-family detached | Yes |
| Owner-occupied one- or two-unit duplex | Yes |
| Semi-detached | Yes |
| Condominium | Yes |
| Town home | Yes |
| Double-wide mobile home | Yes, with a 660 minimum score |
| Located outside Missouri | No |
The duplex line is worth pulling out. MHDC allows an owner-occupied two-unit property, the two-family price limit is $725,146 non-targeted or $886,289 on Next Step, and the rental income from the second unit is excluded from the household income calculation for First Place. That is a genuinely favourable combination for a buyer who wants a tenant helping with the payment. The income exclusions.
The 60-day rule
MHDC requires the borrower to occupy the home within 60 days of purchase, as their principal residence, and borrowers and their spouses must be US citizens or lawful permanent resident aliens.
Sixty days is generous compared with some programs, but it is a real date. If you are buying ahead of a job start, or the property needs work before anyone can live in it, that timeline belongs in the conversation early.
Price limits
| 1-family | 2-family | |
|---|---|---|
| Non-targeted | $566,354 | $725,146 |
| Targeted tract / Next Step | $692,211 | $886,289 |
Under Rev. Proc. 2026-23, effective May 6, 2026. Against Missouri's market these are not tight: Kansas City, the most expensive metro, has a typical value of $327,320, leaving $239,034 of headroom under the lower cap. The price limits and the market.
MHDC also defines the acquisition cost as the total cost of acquiring the residence from the seller as a completed residential unit, including all payments in whatever form. So it is not simply the number on the contract, and unusual structures deserve a look.
Lien position and what cannot sit behind it
- MHDC's program liens must occupy first position, and all outside DPA must be subordinate to MHDC's program.
- All secondary financing must be approved in advance by both MHDC and the master servicer.
- Nehemiah and similar seller-funded programs are prohibited.
- Interest-bearing second mortgages from for-profit companies are prohibited.
- Purchase money seconds designed to avoid mortgage insurance, such as 80/20 or 80/10/10, are prohibited.
What we will not advise on
We are lenders. Whether to buy a house near a flood zone, how to handle a repair item with a seller, and what your purchase agreement says about any of it are questions for your real estate agent and, where they are legal questions, your attorney.
What we tell you is what the loan requires and where a property will and will not finance. Send us an address and we will check the flood zone and the price cap with you.
Frequently asked questions
Can you use MHDC financing on a flood zone property?
Not in zones A or V. Cornerstone's approved lender guidance for MHDC states that all variations of properties located within flood zones A and V are ineligible. The phrase all variations reaches zone A's sub-designations. Given Missouri's river geography this rules out real inventory, so checking the flood zone early is worth doing before you get attached to a property.
What property types are eligible for MHDC?
Single-family detached, owner-occupied one- or two-unit duplexes, semi-detached properties, condominiums, town homes and double-wide mobile homes, all located within Missouri only. Manufactured homes carry a higher minimum credit score of 660 rather than 640. The property must be occupied as a principal residence within 60 days of purchase.
Can I buy a duplex with MHDC assistance?
Yes, an owner-occupied one- or two-unit duplex is on MHDC's eligible property list. The two-family purchase price limit is $725,146 non-targeted and $886,289 in targeted tracts and on Next Step. MHDC also excludes anticipated rental income from the second unit from the household income calculation for First Place, which makes the combination favourable.
How soon must I move into an MHDC-financed home?
Within 60 days of purchase, as your principal residence. MHDC also requires borrowers and their spouses to be US citizens or lawful permanent resident aliens. Sixty days is generous by program standards but it is a real deadline, so a delayed job start or a property needing work before occupancy should be raised early.
Can MHDC assistance be combined with other down payment assistance?
Yes, with conditions. MHDC's program lien must occupy first position and any outside DPA must be subordinate to it, and all secondary financing must be approved in advance by both MHDC and the master servicer. Nehemiah-style seller-funded programs, interest-bearing seconds from for-profit companies, and 80/20 or 80/10/10 structures designed to avoid mortgage insurance are all prohibited.
Mike Certo · NMLS #260555 · Cornerstone First Mortgage NMLS #173855 · Equal Housing Lender. Educational content about financing, not a loan commitment and not legal or tax advice. MHDC program terms, income limits and purchase price limits are set by the Missouri Housing Development Commission and change; figures here carry the date we verified them against MHDC's published documents. MHDC down payment assistance is a forgivable second loan, not a grant, and selling or refinancing inside ten years can require repaying all or part of it. Loans are subject to borrower and property qualification.