Buying a home is one of the most significant financial decisions many Michiganders will ever make. Fortunately, down payment assistance (DPA) programs can help alleviate this burden, making homeownership more attainable for low- to moderate-income buyers, first-time homebuyers, and those in targeted communities. Here’s an in-depth look at key DPA programs available in Michigan in 2025.
Michigan State Housing Development Authority (MSHDA) Programs
1. MI Home Loan DPA – up to $7,500
MSHDA’s flagship DPA program provides up to $7,500 in assistance, typically structured as a deferred, zero-interest second mortgage. The funds can be used for down payment, closing costs, and prepaid expenses. Borrowers typically need a minimum credit score of 640, meet debt-to-income thresholds, and buy within MSHDA’s purchase price limits (often under ~$510,939) michigandpa.commichiganfirst.com.
2. MI 10K DPA – up to $10,000 (interest-free)
Another popular offering, the MI 10K program provides up to $10,000 in interest-free assistance. The loan is deferred, requiring repayment only upon sale, refinance, or when the home ceases to be owner-occupied. It has expanded statewide as of May 2023, previously limited to certain ZIP codes Michigan.gov+1.
3. First-Generation DPA – up to $25,000
Launched in February 2025, this pilot program targets first-generation homebuyers—those who, and whose parents, have not owned a home in recent years. The program offers up to $25,000 via a deferred loan to cover down payment, closing costs, and prepaid expenses. Eligibility requires combining this DPA with a MI Home Loan (conventional, FHA, or USDA), a credit score of at least 640, income limits, completing in-person housing education, and buying a home priced at $224,500 or below Michigan.govFOX 2 DetroitThumbwind. It’s available statewide and backed by $8 million in state funding Manistee News Advocate.
Local & Regional Programs
4. Make My Move – Southwest Michigan (Cass, Van Buren, Berrien counties)
This innovative initiative offers $5,000 in DPA for first-time buyers who live and work in one of these counties and earn at least $40,000 annually. Participants also benefit from free college tuition at Lake Michigan College, school enrollment assistance, community tours, and career guidance—totaling a package valued at roughly $14,000. Applications are open through January 31, 2026, WDIV.
5. Detroit DPA Program
Detroit’s DPA initiative, funded in part by federal ARPA dollars, provides up to $25,000 in assistance for down payment and closing costs for qualifying first-time buyers. The program is designed for renters with low to moderate incomes, aiming to promote homeownership across various neighborhoods. Income limits generally apply (e.g., $45,180 for individuals, $61,320 for couples) Axios.
6. City-specific programs (e.g., Jackson)
Jackson’s “100 Home Program” offers up to $25,000 in DPA for eligible buyers purchasing new one- or two-bedroom homes priced around $175,000. Buyers can also stack MSHDA’s $10,000 DPA for even greater support Business Insider.
Other Notable Options
7. Federal Assistance: USDA Loans & MCC Tax Credit
For residents in rural areas, USDA Rural Development Loans may require no down payment and have favorable terms. These loans can be combined with MSHDA DPA to cover upfront costs downpaymentpath.com. Additionally, the Mortgage Credit Certificate (MCC) program allows homebuyers to claim a federal tax credit on a portion of the mortgage interest annually, which can be paired with other assistance downpaymentpath.com.
8. HomeBoost & Federal HOP
- HomeBoost: Aimed at minority or first-generation buyers, this program offers up to $25,000 in grants (not loans) for down payment and closing costs. It requires working with enrolled lenders and may be combined with MSHDA DPA michiganfirst.commidmi.thelocalelement.com.
- Federal Home Loan Bank’s Homebuyer Opportunity Program (HOP): Offers up to $20,000, forgivable after five years of occupancy. Available through participating lenders midmi.thelocalelement.com.
9. Individual Development Accounts (IDA) – Mercantile Bank
This matched-savings option enhances your own contributions—eligible buyers receive a 3-to-1 match on savings toward the down payment. For example, save $1,000 and receive $3,000 in matches—totaling $4,000 toward your purchase. Can be stacked with other DPA options midmi.thelocalelement.com.
Federal HOME Program
While not specifically Michigan-based, the HOME Investment Partnerships Program, administered by HUD, provides block grants to states, including Michigan. These funds can be used for down payment or rehabilitation assistance, typically for low-income families (below 80% of the area median income) and often require borrower counseling Wikipedia.
Key Considerations & Strategy
Eligibility | Programs vary by credit score (usually ≥640), income, first-time/first-gen status, and location. House price caps also apply. |
Stackability | Many programs—like MSHDA DPAs, HomeBoost, USDA, or local grants—can be combined, but some may prohibit stacking (like First-Gen DPA with MI 10K) FOX 2 Detroit. |
Repayment Terms | Most are deferred, interest-free loans repayable upon sale, refinance, or occupancy change. Grants (e.g., HomeBoost, Detroit DPA) do not require repayment. |
Education/Counseling | Homebuyer education (often HUD-approved, in-person or online) is frequently required. |
Local Differences | County or city programs can offer substantial additional benefits—check with local housing agencies or nonprofits. |
How to Get Started
- Explore MSHDA’s official site for detailed program criteria and approved lender listings.
- Connect with local lenders or nonprofit housing counselors—they can guide you through matching programs and help you stack eligibility.
- Attend the required homebuyer education, as it is a prerequisite for many programs.
- Compare programs based on your profile:
- First-generation or minority buyers may qualify for the $25K First-Gen or HomeBoost.
- Rural buyers may benefit from USDA loans plus MSHDA DPA.
- Urban residents in areas like Detroit and Jackson have their own robust local options.
- Submit your applications early—many programs have limited funding or revolving waitlists.
Conclusion
Michigan’s DPA landscape is robust and diverse, ranging from state-level support through MSHDA programs to innovative local efforts in Detroit, Jackson, and Southwest Michigan, as well as federal supplements such as USDA or MCC options. Whether you’re a first-time homebuyer, a first-generation purchaser, or aiming to relocate to revitalizing communities, there’s a program tailored to help you bridge the gap to homeownership. With planning, the right lender, and timely application, you can turn your homebuying dreams into reality.
Learn More About Our Real Estate Services and How We Can Help You Buy or Sell Your Home
Let me know if you need links for specific sections or pages on the website!
Thank you for reading! If you enjoyed this article and want to explore more content on similar topics, check out our other blogs at Sonic Loans, Sonic Realty, and Sonic Title. We have a wealth of information designed to help you navigate the world of real estate and finance. Happy reading!