The Michigan State Housing Development Authority (MSHDA)
is considering expanding a down-payment assistance program that, when
combined with the 2009 $8000 Federal Tax Credit, would provide more
than $15,000 in help for first-time home buyers.
The MSHDA program offers down payment assistance up to $7500.
Currently, however, your household income must be below $55,000 to be
eligible. I've sold many homes with this program in Grand Rapids, but
was often unable to help families with incomes that exceeded the limit.
This may be about to change, however. If MSHDA's new plan is
approved, MSHDA would raise its limits on the household income for
buyers eligible for the $7,500 loan from the current level of $55,000
to more than $100,000. This would open the door to a lot more potential
MSHDA Loans are commonly referred to as a "piggy-back" type loan.
"Piggy-back" loans are not stand alone mortgage products, but instead
can be used in conjunction with other loans. When paired with another
mortgage plan, like an FHA loan, for example, buyers can get enhanced
benefits in their mortgage choices.
Combining the Federal First Time Homeowner's Tax Credit of up to
$8000 with MSHDA's $7500 plan means that homeowners could get more than
$15,000 in savings on a new home. The state loans can be used for homes
worth up to $224,500.
The MSHDA Loan is different from the $8000 Federal Tax Credit in
several ways. It is not a credit, but rather an interest free loan. The
loans do not have to be paid back until the home is sold or the
mortgage refinanced or paid in full. There are no monthly payments on
the loan. Unlike the $8000 Federal Tax Credit, you can use the money at
closing, rather than waiting until you file your tax return. The MSHDA
loan can be used for closing costs, expenses such as setting up escrow
accounts, or down payments.
you've been thinking about buying a home, but don't think you can
afford the down payment, think again. There are loan programs out
there, but you have to know about them. Contact your lender for more
information about MSHDA/FHA, MSHDA/RD, and other MSHDA combo loans.
Prices are the lowest we've seen in years, and interest rates are at
historic lows. 8 out of 10 economists predict that home prices will
rise within the next five years. What more reason do you need to
consider buying a home today? Contact me or your local real estate
professional to find out how you can fulfill your dream of home
You can get more information about the $8000 Federal Tax Credit here.