Michigan: 2023 Programs and Grants Available for First-Time Home Buyers

A Comprehensive Guide to Buying Your First House in Michigan

Thinking about buying your first home in Michigan? The journey to homeownership is an exhilarating one, filled with opportunities and options. Michigan welcomes first-time home buyers with free advice, counseling, unique mortgage programs, and even cash assistance to bridge any financial gaps.

Here’s a roadmap to guide you through the Michigan home-buying process.

Verify Your Home Buying Eligibility in Michigan Start here (Aug 7th, 2023)

Michigan Home Buyer Overview

In May 2023, the average home sale price in Michigan reached $282,085, a 2.45% increase compared to the previous year. While some states have seen faster growth, even this modest hike can make saving for a down payment more challenging.

Down payment amounts are often determined by the state’s current average home sale price, with a “minimum” down payment possibly being as low as 3% on a conventional mortgage (with a minimum credit score of 620). For those eligible for VA or USDA loans, you may not need any down payment.

Here’s how you can turn the challenge of home buying into an achievable goal.

First-Time Home Buyer Loans in Michigan

Michigan offers a broad spectrum of home buyer loans tailored to your unique situation.

If you’ve saved 20% down: You can acquire a conventional loan with a low-interest rate and no need for private mortgage insurance (PMI).
If you’ve saved less than 20% down: Don’t worry! You can still secure a new home with as little as 3% or even 0% down through various low-down-payment mortgage programs.
- Conventional 97 Loan: Offered by Freddie Mac or Fannie Mae, this requires a mere 3% down payment and a minimum credit score of 620. Plus, you can usually cease mortgage insurance payments after a few years.
- FHA Loan: This Federal Housing Administration-backed option needs 3.5% down and a 580 minimum credit score, but entails ongoing mortgage insurance premiums (MIP).
- VA Loan: Tailored for veterans, active military, reservists, and National Guard members, this loan requires no down payment, often with a 620 credit score. It doesn’t include ongoing mortgage insurance.
- USDA Loan: Ideal for those with low-to-moderate incomes in designated rural areas. It demands no down payment and often a 640 credit score. There are also income and location restrictions.
- MSHDA Loan: This might include competitive interest rates and compatibility with various assistance programs for down payments and closing costs.

Find the best first-time home buyer loan for you. Start here (Aug 7th, 2023)

Additional Support and Information

Most of these programs enable the use of gifted money or down payment assistance (DPA), facilitating your purchase with minimal personal expenditure. Whether it’s your first mortgage or a specific program, your loan officer or real estate agent can guide you to the best option.

Note: Government loans, such as FHA, VA, and USDA, require the purchase of a primary residence, excluding vacation homes or investment properties.

Your Path to Homeownership in Michigan

Buying your first house in Michigan is a significant life milestone, and it might seem complex. However, with the array of special programs, support, and mortgage options available, you’re well-positioned to make an informed decision.

Leverage this guide and the resources provided by professionals in Michigan’s real estate industry to embark on your home-buying journey with confidence. With the right information and choices, you can transition from an aspiring homeowner to a proud resident of Michigan. Happy house hunting!