The Michigan State Housing Development Authority (MSHDA) created a program to help first time home buyers buy a home. This program offers up to $7500 to borrowers to act as a down payment, helping buyers purchase a home with no money out of pocket.

This down payment assistance is great for anyone interested in buying their first home but worried about coming up with the money to put down and pay closing costs. MSHDA Down Payment Assistance funds can be used toward the down payment, closing costs, inspection costs, or escrow expenses, meaning it can literally cover all costs to buy a home.

But these funds are not free money. These funds are given to the borrower by the state, and act as a “silent second” mortgage. What that means is that whenever the house is sold, transferred, or refinanced, the money must be repaid, just like any other mortgage on the house. Unlike your primary mortgage, however, this one is “silent” because there are no payments due on it month to month and it does not accrue interest. So, if you get $7500 in down payment assistance, you will only owe $7500 when you sell, transfer, or refinance your home, whether that is in 6 moths or 30 years.

This assistance is for qualifying low and moderate income households in specific areas. To find out if you qualify, or for more information on whether or not MSHDA Down Payment Assistance is right for you, please leave a comment or contact me. I would love to help you better understand this wonderful program.