First-time home buyer programs in Michigan and Detroit

What this page covers

Michigan’s state housing finance agency is MSHDA. Its loan and down payment programs set their own income limits, sales-price limits and amounts, and these change during the year. MSHDA’s own program pages did not open for our automated checks on October 13, 2026, so we do not quote MSHDA amounts or limits here. Before you apply, confirm the current terms with MSHDA or with a lender that offers its loans. The MSHDA agency locator lists housing education agencies and experienced “MI Home Loan” loan officers by county, including Wayne County, where Detroit sits.

What we could read in full is the City of Detroit’s own program, below.

Detroit Down Payment Assistance (DPA), Phase III

The city funds the program with about $9 million from federal Community Development Block Grant (CDBG) and CDBG Disaster Relief (CDBG-DR) money. A May 22, 2026 city bulletin states that the guidelines posted on the city’s website are the governing version; earlier distributed versions should be disregarded. Funds are first-come, first-served, and the city’s pages do not say whether money is still available, so check before you count on it.

What it pays

You will not automatically receive the maximum: the amount depends on the purchase price, prepaids, rate buydown and closing costs. The assistance can be combined with other down payment help.

Income limits (80% of area median income)

Source: City of Detroit, DPA Program Phase III guidelines, read October 13, 2026. Another city page, “Am I Ready?”, shows a different, lower table ($80,800 for four people). The Phase III guidelines page is the one the May 22 bulletin treats as governing, so we show its table. Call the city to confirm before relying on either.

Who qualifies

• You have lived in the City of Detroit for the past 12 months, or lost a Detroit home to property tax foreclosure between 2010 and 2016.
• You have not held an interest in a home for the past three years.
• Your household income is within the limits above.
• You complete a homebuyer education course and receive a certificate.
• You have a lender pre-qualification and a signed purchase agreement.
• You complete a visual lead inspection (risk assessment) by a licensed inspector.

Households affected by the August 2023 flooding, and households whose Detroit property was foreclosed for tax over-assessment from 2010 to 2016, get priority. A real estate agent is not required, and you may choose your own lender. Review typically takes 2 to 3 weeks after a complete application, which is made online through the city’s portal.

A worked example

A family of four earning $80,000 is under the $83,850 limit. Suppose they buy a $120,000 home. The 50% cap would allow up to $60,000, so the $25,000 maximum is the binding limit. The actual award depends on their closing costs, prepaids and any rate buydown, so it may be lower. This is an illustration, not a promise of an award.

Free housing counseling

HUD says you can find a HUD-approved housing counselor by searching its online tool or calling (800) 569-4287, or contact MSHDA’s Housing Education Program, which uses HUD-certified counselors. The City of Detroit also points buyers to the Detroit Housing Resource Network (detroithousingnetwork.org), which lists free housing counseling from community nonprofits.

If you are thinking about buying on a land contract, the city recommends speaking with a housing counselor first. Under a land contract the seller keeps the deed until you finish paying, and the city warns that you can lose the home to forfeiture if you miss payments, or to tax foreclosure if property taxes go unpaid for three years.

Other help to check

Federal loan programs are not specific to Michigan: see our guides to FHA loans and VA loans. Before you commit, review the Michigan closing costs, the home prices in Michigan and Detroit and the steps of buying a home.