Detroit Renters Offered a $6 Million Down Payment Program to Become Homeowners

Detroit Homeowner Assistance

City leaders announced a new Downpayment Assistance Program on Thursday, offering residents seeking to buy a home up to $25,000 in assistance for their down payment. The program, supported by 13 banking institutions, aims to help renters transition into homeownership, protect them from rising rents, and foster generational family wealth, according to Mayor Mike Duggan.

The Downpayment Assistance Program is funded by a $6 million allocation from the American Rescue Plan Act pandemic relief funds. Mayor Duggan highlighted that this is the first time such a program has been offered in 25 years, and its introduction is the result of collaborative efforts by numerous stakeholders.

The initiative was proposed by District 4 Council Member Latisha Johnson as a component of the $203 million Affordable Housing Plan announced by council members and Mayor Duggan in July. Johnson believes that the program will help many Detroit families improve their lives, providing both housing stability and a chance to build generational wealth. The $25,000 assistance will make homeownership significantly more accessible for these families.

In his recent State of the City address, Mayor Duggan cited a Zillow report which showed that Black-owned homes in Detroit gained more value than White-owned homes, more than in any other city in the United States. However, the same report indicated that Detroit has one of the highest mortgage denial rates for Black borrowers. Mayor Duggan emphasized the city’s efforts to increase mortgage availability since the crash, including a meeting with President Obama in 2015 to address the issue at both the national and local levels.

To qualify for the down payment assistance, Detroit residents must have lived in the city for the past 12 months, providing proof of rent and utility payments. The program is not open to current homeowners or those who have owned a home within the past three years. With a capacity for 240 to 400 applicants on a first-come, first-serve basis, Mayor Duggan is optimistic that the program will be in high demand.

Participants will be required to move into a home that meets code requirements or use a renovation mortgage to purchase a home from the land bank and renovate it themselves. Income eligibility is based on a sliding scale relative to household size, with the threshold set at 300% of the poverty level.

Interested residents must first identify a lending institution to partner with for a mortgage. Participating mortgage partners include major banks such as Bank of America, Chase Bank, and CIBC, among others. Once a lender and prospective home have been identified, residents can apply at or by calling (313) 244-0274.

Dina Harris, founder and president of National Faith Homebuyers, believes the program will change lives. Her nonprofit organization, which assists families in purchasing homes through education and services, will be vetting applicants. Council Member Johnson emphasized the program’s ability to provide financial stability and support for potential homeowners amid increasing housing prices.

Mayor Duggan also suggested that landlords who are struggling to maintain multiple properties consider selling some to help bring others into compliance. The program offers preference to individuals who have lost their homes to property tax foreclosure.

City Council President Mary Sheffield stressed the united efforts of the council and administration in creating accessible, affordable housing and addressing the issue of over-assessed properties. The Downpayment Assistance Program aims to provide preference and support to those who may have lost their homes due to property tax foreclosure, helping them regain homeownership.

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