2025 Guide to Down Payment Assistance Programs in Michigan

How to Buy a Home with up to $25K in Financial Support

Thinking about buying a home in Michigan but unsure how you’ll cover the down payment or closing costs? You’re not alone — and the good news is, there’s help available.

In 2025, Michigan homebuyers have access to down payment assistance programs worth up to $25,000 — including grants, forgivable loans, and zero-interest second mortgages. Whether you’re a first-time buyer in Detroit or relocating to the suburbs, this guide will help you navigate the best programs available and how to qualify.

Why Down Payment Assistance Matters

The down payment is often the #1 barrier to homeownership — especially for renters and first-time buyers. With rising housing costs and limited savings, it’s common to feel stuck.

But with the right support, you could:

• Buy your home sooner

• Save thousands upfront

• Keep more cash on hand after closing

Let’s explore the most powerful down payment assistance programs available in Michigan right now.

1. MSHDA’s MI 10K DPA Loan Program

The Michigan State Housing Development Authority (MSHDA) has expanded its flagship MI 10K DPA program statewide in 2025, providing up to $10,000 to cover down payment and closing costs.

Key Features:

• 0% interest, no monthly payments

• Covers appraisal gaps and closing costs

• Must be paired with a MSHDA MI Home Loan (FHA, RD, or conventional)

• Minimum 1% buyer contribution required

📌 Repayment is deferred — you only pay it back if you sell, refinance, or move out.

This is one of the most accessible programs for first-time and income-qualified homebuyers across Michigan.

2. First-Generation Homebuyer Program – $25,000

New in 2025, MSHDA introduced the First-Generation Down Payment Assistance Program, offering $25,000 in deferred financial support.

You may qualify if:

• Neither of your parents ever owned a home, or

• You were previously in foster care

Funds can be used for:

• Down payment

• Closing costs

• Prepaid expenses (taxes, insurance, etc.)

✅ No monthly payments and no repayment required if program terms are met. Available statewide and aimed at building generational wealth.

3. City of Detroit Down Payment Assistance – Up to $25,000

If you're buying in Detroit, the city’s revitalized program — funded by the American Rescue Plan Act (ARPA) — offers up to $25,000 in assistance for eligible buyers.

Who’s eligible?

• Must be a first-time homebuyer

• Must purchase within Detroit city limits

• Income limits apply:

  • 1-person household: $45,180

  • 2-person household: $61,320

💡 This is a forgivable loan — meaning it won’t have to be repaid if you stay in the home for a certain number of years.

4. National Programs Available in Michigan

In addition to MSHDA and city-specific support, these national loan programs offer powerful benefits for eligible Michigan buyers.

HomeReady® and Home Possible® – $2,500 Credit

These programs, offered by Fannie Mae and Freddie Mac, provide:

• A $2,500 lender credit

• Low down payment options (as low as 3%)

• Flexible income and credit requirements

🔍 Ideal for buyers earning below 50% of their Area Median Income (AMI).

United Wholesale Mortgage (UWM) 0% Down Program

UWM has launched a 0% down payment program in 2025 that helps buyers cover their entire down payment upfront:

• Up to 3% of the home price covered (max $15,000)

• Structured as a second-lien loan

• No interest and no monthly payments

• Balloon payment due only at payoff, refinance, or sale

Perfect for buyers with solid income but limited savings.

🧠 Frequently Asked Questions About Down Payment Assistance in Michigan

What is down payment assistance (DPA)?

Down payment assistance is financial support offered to homebuyers to help cover the upfront costs of purchasing a home — including the down payment, closing costs, or prepaid expenses. It can come in the form of grants, forgivable loans, or second mortgages and is typically provided by state housing agencies, local governments, or approved lenders.

Who qualifies for down payment assistance in Michigan?

Eligibility varies by program, but in general, you may qualify if:

• You’re a first-time homebuyer (or haven’t owned a home in the last 3 years)

• You meet income limits based on your county and household size

• The home will be your primary residence

• You complete a homebuyer education course

• You meet the minimum credit score (usually 640 or higher)

Some programs are also open to repeat buyers or first-generation homebuyers.

Is down payment assistance free money?

Not always. Some assistance is a grant that does not require repayment, while others are forgivable or deferred loans. Forgivable loans may be erased after you live in the home for a set number of years. Deferred loans are typically repaid when you sell the home, refinance, or move out.

How do I apply for down payment assistance in Michigan?

Start by getting pre-approved with a lender who offers MSHDA or other approved programs. You’ll also need to complete a certified homebuyer education course. From there, your agent and lender will help you submit the required application paperwork along with your loan documents.

Want to know what programs you qualify for? Click here to use our free DPA eligibility tool.

Can I use more than one down payment assistance program?

Yes, some programs can be layered. For example, you might be able to use MSHDA’s $10,000 assistance along with a city grant or lender credit. Your mortgage lender will confirm which combinations are allowed based on the loan structure and program rules.

What’s the minimum credit score I need?

Most programs require a credit score of at least 640. Some may allow lower scores with additional documentation, reserves, or compensating factors. Your lender can guide you on the best options based on your current credit profile.

Do I have to pay back the assistance?

It depends on the program:

• Grants: No repayment required

• Forgivable loans: Repaid only if you move or sell before the forgiveness period ends

• Deferred loans: Paid back when you sell, refinance, or stop living in the home

Be sure to understand the repayment terms before you commit.

Are these programs only for low-income buyers?

No. Many programs are designed for low-to-moderate income households, but income limits are more generous than most people expect. In some counties, a household of two can earn $80,000 or more and still qualify.

Can I qualify if I’ve owned a home before?

Yes. If you haven’t owned a home in the last three years, most programs will still consider you a first-time homebuyer. Some newer programs, like UWM’s 0% Down, are open to repeat buyers as well.

🎯 Find Out What You Qualify For Instantly

Want to know which programs you’re eligible for based on your income, location, and credit? We’ve got the perfect tool for you.

👉 Click here to see which down payment assistance programs you qualify for

This free resource helps you:

• Get matched to local, state, and national DPA programs

• See how much money you could receive

• Prepare to talk to your lender with confidence

📲 No commitments — just quick, helpful answers based on your profile.

Final Thoughts: Don’t Let the Down Payment Hold You Back

In 2025, there’s no reason to let your savings hold you back from owning a home in Michigan. With up to $25,000 in available assistance and several programs that don’t require repayment, the path to homeownership is more open than ever.

Whether you're buying in Detroit, the suburbs, or anywhere across the state, our team at Match Realty is here to help you navigate your options, find the right lender, and get your offer accepted.

📞 Let’s Talk About Your Next Move

Ready to start your journey?
We’ll walk you through your options, connect you with the right lender, and help you buy smart.

Cyrus Wheeler | Match Realty
📱 (313) 482-7432
📧 Cyrus@MatchRealty.com