The Michigan State Housing Development Authority (MSHDA) offers Mortgage Loan Programs as well as Down Payment and Closing Cost Assistance to low to moderate income individuals and families to buy a home in Michigan. Mortgage loans are obtained through participating lenders approved by the MSHDA.
Michigan Homeownership Loan Products – What Can I Qualify For?
If you are a low to moderate income individual or family who meets MSHDA sales price and income limit eligibility requirements in Michigan, MSHDA has a variety of mortgage loan programs and down payment assistance programs to most likely fit your needs.
If you are a first time home buyer you may use a MSHDA mortgage program anywhere in Michigan to purchase a home provided you meet the income restrictions and the home you are purchasing meets the purchase price limits set by MSHDA. If you are not a first time home buyer, then you can still use MSHDA’s loan programs to purchase a home, but you will have to purchase a home in a “targeted area.”
Mortgage loan programs included in the MSHDA first time home buyer and second time home buyer loan product portfolio include FHA loans, Loans for Veterans – VA Loans, Rural Housing Service Loans, and Freddie Mac and Fannie Mae 95 to 97% Loan to Value Conventional Loans.
Homebuyers must qualify for these loans with a participating lender, or mortgage company just like they would any other mortgage loan program. In order to qualify homebuyers will have to have a job with a satisfactory employment history, decent credit, and some money to contribute to their down payment and closing cost requirements.
What Is A Michigan Targeted Area?
A targeted area is a geographical area either at the county or the census tract within a county. HUD and MSHDA have deemed certain counties and census tracts within Michigan as areas that have certain community and economic development needs. By declaring an area as a target area, home buyers with income greater than the normal Area Family Median Income limits can purchase a home.
Also in targeted areas the purchase price limits are expanded to allow more homes to be purchased. Finally, non first time home buyers can also purchase homes in a targeted area using a MSHDA mortgage assistance program whereas in other non targeted areas – only first time home buyers can use the MSHDA programs.
What Is A First Time Home Buyer In Michigan?
According to MSHDA for the purposes of home buyers buying a home in Michigan, first time home buyers are someone who has not owned a home within the past three years. Adults living in a home using a MSHDA program who have been a homeowner in the past three years could disqualify to the home buyer getting the loan.
Down Payment Assistance and Closing Cost Programs For Disabled Michigan Homebuyers
Low to moderate income families with a disabled family member or one of the homebuyers is a disabled person using a MSHDA mortgage loan program to purchase a home may be eligible for a Down Payment Assistance Loan. This program provides a second mortgage up to 8% of the sales price for down payment and up to $3,000 for closing costs. The total second mortgage loan amount with this program can go up to $12,000. Homebuyers using this program must contribute at least $500 of their own money.
This loan program is called the HomeChoice Down Payment Assistance Loan is available to disabled borrowers who meet the Program's Income Limits. These income limits are based on 80 percent of the area median income, adjusted for family size, except where lower by state law. The loan is given at zero percent interest, does not require a monthly payment and is required to be paid when the home owner sells their home, transfers the property to another owner, or they refinance their first mortgage.
Other Home Purchase and Down Payment Assistance Programs by MSHDA
- Employer Assisted Housing – Participating employers, in partnership with MSHDA, can offer their employees who qualify a competitive and low interest mortgage to purchase a home. Additionally, MSHDA provides from $2,500 to $5,000 in matching funds in the form of a Down Payment Assistance Deferred Loan to be used for down payment and closing cost requirements. Homebuyers using this program must complete homebuyer education classes.
- Graduate Purchase Assistance – College graduates who have earned an associate's, bachelors, masters, or doctoral degree within the last three years, you may be eligible to purchase a home. Interest rates for this program are two percent less than market rates. Income and purchase price restrictions apply. Also, to participate in this program graduates must purchase a home in: Benton Harbor, Detroit, Flint, Hamtramck, Highland Park, Muskegon, Pontiac, and Saginaw.
To get additional information about down payment assistance programs, or to find out more about mortgage programs please complete the information below:
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