Mortgage

Michigan First Time Dwelling Consumers: Packages and Grants for 2021

What You Should Know About Buying a Home in Michigan

As a first-time home buyer in Michigan, you can access free advice, advice, and some specialty mortgage programs.

Even better, you may be able to get cash help to bridge the gap between your savings and your down payment and closing costs needs.

How to start.

Check Your Eligibility to Buy a Home in Michigan. Start here (13.10.2021)

In this article (continue to …)

Michigan Home Buyer Summary

The average Michigan home sale price in July 2021 reached $ 245,439, according to Michigan Realtors. That was 11.79% more than in the same month in 2020.

Although some other states have seen faster home price growth, such a large increase can cause problems for first-time home buyers in Michigan. Even with prices stable, it's hard enough to save on a down payment.

So read on to discover cash aid that could add to your savings.

Michigan Home Buyer Summary

Average home sale price in MI
$ 245,440

Minimum deposit in MI (3%)
$ 7,360

20% deposit in MI
$ 49,090

Average credit score in MI1
714

Maximum MI Home Buyer Grant2
Up to $ 14,000 Loan After 5 Years (Warren Only)

Down payment amounts are based on the last available average home sale price in the state. A “minimum” down payment is assumed to be 3% less than a conventional mortgage with a minimum credit rating of 620.

If you are eligible for a VA loan (supported by the Department of Veterans Affairs) or a USDA loan (supported by the U.S. Department of Agriculture), you may not require a down payment at all.

Check Your Eligibility to Buy a Home in Michigan. Start here (13.10.2021)

First Time Loans For Michigan Homebuyers

The first time you buy a home in Michigan and pay a 20% down payment, you can get a conventional loan with a low interest rate. And you never have to pay for personal mortgage insurance (PMI).

Of course, only a few first-time buyers have saved enough for 20 percent. But the good news is you don't need that much. By far not.

Borrowers can often move into a new home as little as 3% or even 0% with one of these low down payment mortgage programs:

Conventional 97 – From Freddie Mac or Fannie Mae. 3% down payment and at least 620 credits. You can usually stop paying mortgage insurance after a few yearsFHA loans – Supported by the Federal Housing Administration. Down 3.5% and a credit score of at least 580. But you're usually on the hook for mortgage insurance until you refinance, move to another type of mortgage, or pay off your loanVA loan – For veterans, active service members, reservists and National Guard only. A zero deposit is required. The minimum credit score varies by lender, but is often 620. No ongoing mortgage insurance upon completion. These are arguably the best mortgages available. So apply when you are eligibleUSDA loan – For low to middle income people who shop in designated rural areas. Zero deposit required. The creditworthiness requirements vary depending on the lender, but often 640. Low mortgage insurance ratesMSHDA loan – May include competitive interest rates and can be used with down payment assistance. More information below

Note that most of these programs require you to purchase a primary residence. This is a home that you will live in full time, not a vacation home or investment.

Depending on the mortgage loan you choose, you may be able to get into your new home with minimal cash out of your pocket.

With these programs, you can even use free cash or Down Payment Assistance (DPA) to help cover down payment and closing costs.

If you are unsure which program to choose for your first mortgage loan, your lender can help you find the right deal based on your finances and your home purchase goals.

Find the best first-time buyer loan for you (10/13/2021)

Michigan Programs for First Time Home Buyers

The Michigan State Housing Development Authority (MSHDA) offers two mortgage programs:

MI home loan – Minimum credit worth 640. Or 660 for multi-section prefabricated housesMI home loan flex – Minimum credit score of 660. However, other ways may make it easier to qualify for any of these points

Both loan options provide down payment assistance, and both may be suitable for a first-time Michigan home buyer.

To qualify, you must meet basic lending criteria as well as some special MSHDA rules:

You may also be eligible for a Mortgage Loan Certificate (MCC) that provides savings on your federal taxes, possibly for the life of your loan.

Grants for First Time Home Buyers in Michigan

The MSHDA offers down payment assistance loans rather than grants. However, these charge 0% interest and do not require monthly payments. You simply pay back the amount borrowed when you sell, refinance, transfer, or permanently pay off your mortgage.

You can borrow $ 7,500 anywhere in Michigan under these programs. And that's more than the average 3% down payment in the state.

And if you're lucky enough to shop in any of 236 zip codes and use an MI home loan, you can potentially borrow up to $ 10,000.

There are many other down payment support programs in Wolverine State. And your city or county can offer one.

So take a look at the list below and search online for "(your city or county) Down Payment Assistance". You need to find out which one offers the help that suits you best, regardless of whether it is a state or local program.

Check Your Eligibility to Buy a Home in Michigan. Start here (13.10.2021)

Buy a home in one of Michigan's major cities

There is good news and bad news for those looking to shop in Detroit. First, home prices are exceptionally low by national standards for a large city. But second, those prices have increased by a staggering amount over the past year: 33.2% between August 2020 and 2021.

The only of Michigan's three largest cities with property prices above the national average was Grand Rapids. Warren was between the other two and had the lowest house price inflation: just 6.3% for the August-August period.

First time home buyer in Detroit

The average list price in Detroit was $ 79,900 as of August 2021, according to Realtor.com. That was 33.2% more than in the previous year.

If you want to buy a home at this average price, your down payment options can be between the following options:

$ 2,400 for 3% deposit$ 15,980 for 20% deposit

In terms of homebuyer assistance, Detroit City lists "Potential Incentives for New or Current Detroit Homeowners".

This includes the Detroit Home Mortgage. The website states that "qualified borrowers can get a mortgage of up to $ 75,000 above the appraisal of a home to buy a ready-to-move home."

However, you still need a "sufficient" deposit (whatever that means; maybe 3%). And the down payment assistance offered appears to only cover certain closing costs and varies by lender. You also need a credit rating of 640 or better.

Also check out National Faith's Down Payment Support Program for Wayne County. It states it “offers a $ 7,500 fixed loan loan on existing homes. This loan is forgivable after five (5) years at 0% interest. "

So if you stay in the home for five years and during that time you fail to sell the home or refinance, transfer, or repay the mortgage, you owe nothing on your down payment loan.

Grand Rapids first-time home buyers

The average list price in Grand Rapids was $ 229,000 in August 2021, according to Realtor.com. That was 9.6% more than in the previous year.

If you want to buy a home at this average price, your down payment options can be between the following options:

$ 6,870 for 3% deposit$ 45,800 for 20% deposit

Grand Rapids' Homebuyer Assistance Fund (HAF) program offers up to $ 7,500 for low- and middle-income homebuyers. Buyers can use the money for down payment, closing costs, and advance payments. Click the link for the terms.

The website says that you have to stay in the apartment for five years. But it doesn't say what happens when that time is up. Is the loan taken? Or are the debts paid back at some point afterwards? Call (616) 456-3677 or email communitydev@grcity.us to find out.

Warren first time home buyer

The average list price in Warren was $ 169,900 as of August 2021, according to Realtor.com. That was 6.3% more than in the previous year.

If you want to buy a home at this average price, your down payment options can be between the following options:

$ 5,100 for 3% deposit$ 33,980 for 20% deposit

The City of Warren Direct Homebuyer Assistance Program says, “The city will be half the size
required down payment and up to $ 2,500 in closing costs (including prepaid taxes and interest) for a
The total may not exceed $ 14,000 per eligible household as required. "

Provided you are a responsible homeowner and you stay in your residence for five years, your entire down payment loan will be waived after those five years. Click the link for all terms.

This is the best deal we've found in Michigan: a loan of up to $ 14,000 that expires after five years. It certainly surpasses what the MSHDA has to offer.

Where can I find help buying a house in Michigan

All of the organizations listed above should provide free advice to any first-time home buyer in or near Michigan.

In addition to our selections, the US Department of Housing and Urban Development (HUD) offers some lists for statewide, regional, and local resources.

Michigan state and regional first-time buyer programs

The HUD website provides a list of resources for first-time home buyers in Michigan by city and location.

What are the mortgage rates in Michigan today?

Here you can see the current live mortgage rates in Michigan.

When you're ready to start buying your home, make sure you get personalized interest rate quotes from at least three mortgage lenders.

Don't just look at the advertised prices online; In fact, apply for pre-approval and compare the interest rates and fees that are offered to you. This is the only way you can be sure that you are getting the best possible offer for your new home loan.

Confirm your new plan (October 13, 2021)

1 Source: Experian.com 2021 study on 2020 data

2Based on a review of available state DPA grants at the time of this writing

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