DETROIT (WWJ) – The city of Detroit is rolling out a new plan to help low-income residents become homeowners in the city.
The Detroit Downpayment Assistance Program, thanks to funds from the American Rescue Plan Act (ARPA), will give some Detroiters up to $25,000 to make a downpayment.
Officials say the program is “available to lower-income earners who may be able to afford a monthly mortgage payment but don’t have savings enough for a downpayment.”
To be eligible for the program, residents must have lived in Detroit for the past 12 months, must not have owned a home in the last three years and make under a certain income threshold. For a single person to qualify, for example, they would have to earn less than $41,000 per year.
The program is part of the $203 million Affordable Housing Plan that Mayor Duggan and his administration unveiled last July. Thirteen lenders will be participating in the program, including Bank of America, Chase, Huntington Bank and others.
Funded by $6 million in ARPA funding, the program provides qualifying Detroit households grants of up to $25,000 for a downpayment. Funding also can be used for other home purchase-related expenses, including prepaids (such as escrow deposits for property taxes), interest rate buy-downs, closing costs and reduction in principal.
Officials estimate the program will help 240-400 lower-income and middle-class Detroiters buy homes over the next two years, depending on the amount each family needs in downpayment assistance.
Speaking Thursday, Detroit Mayor Mike Duggan called the program a “game changer” for Detroiters looking to buy a home.
“You pick out your house, you go to your lender, your lender is gonna work really hard to get you to be one of the first 400 in the door,” Duggan said. “I would say you couldn’t have a better time to try to convert and I have no doubt if we get 400 homeowners for $6 million, there’s gonna be a lot of support from us to find more money and do it again.”
This new effort to boost homeownership in Detroit comes six months after Detroit’s return to its status of being a majority homeowner city for the first time in decades, according to the city.
More information on the program can be found at detroitdpa.org.
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