LANSING, Mich. — A new first-time homebuyer program through the Michigan State Housing Development Authority (MSHDA) will give eligible buyers a reduced interest rate while funding lasts.
The Rate Relief Mortgage is a new program through the partnership of the Federal Home Loan Bank of Indianapolis (FHLBank Indianapolis) and MSHDA.
FHLBank Indianapolis is supporting the program through a $50 million bond purchase through MSHDA. That $50 million will be used to lower interest rates by one full percentage point for eligible first-time homebuyers who finance through the program.
In order to qualify for the program, a homebuyer must:
- Be a first-time homebuyer.
- Have a qualifying income at or below 80% of the Area Media Income.
- Have a credit score of 640 or higher.
- Work through an FHLBank Indianapolis member who is also a MSHDA-participating lender. (Find a list of those banks here)
- Purchase a new or existing single-family residence.
- Have a 30-year mortgage term.
- Purchase a home with a maximum sales price limit of $224,500.
To apply for the program, MSHDA said "interested first-time homebuyers can get more information at their local lending institution."
Lawmakers in Michigan are also currently considering legislation (House Bill 5032) that would eliminate the maximum cap of $224,500 on mortgages eligible for the program.
“Every Michigander should be able to raise their family in a home they love,” said Lt. Governor Garlin Gilchrist II. “That is why we have made historic investments to build or rehabilitate 34,000 housing units and announced the largest housing investment in state history. The MSHDA Rate Relief Mortgage program will lower the mortgage interest rate for eligible homebuyers by a full percentage point, saving families hundreds each year, keeping money in their pockets, and helping more Michigan families achieve their dream of homeownership."
You can learn more about the program here.
