The start of 2022 brought an uptick in mortgage rates for those looking to purchase a home or refinance their current home. Effective Friday, March 25th, 2022 rates for the MSHDA programs are also increasing. It can be daunting to hear about any increase in rates but understanding those changes and what to expect from this down payment assistance loan can help you decide on the best mortgage product for your needs.
What are MSHDA Down Payment Assistance Loans?
MSHDA MI Home Loan Programs are mortgage products created to help qualifying homebuyers to purchase their home by offering down payment assistance. One popular MSHDA product provides up to $7,500 in down payment assistance and only requires borrowers to contribute a minimum investment of 1% of the sales price.
Another great MSHDA program is the MI 10k DPA Loan which provides qualified buyers up to $10,000 to use towards the down payment, closing costs, and escrow on the home. This mortgage product assists homebuyers who are looking in specific geographic areas where the rate of homeownership needs improvement.
What are the current MSHDA Rates as of March 2022?
The standard rates on these MSHDA MI Home Loan Programs have increased effective March 25th, 2022. If you’re comparing rates and programs, the current MSHDA rates are the following:
- MI Home Loan no DPA 3.825% APR 3.976%
- MI Home Loan up to $7,500 DPA 4.625% APR 4.731%
- MI Home Loan up to $10,000 DPA 4.625% APR 4.731%
What to Know About the Changes?
If you have an existing MSHDA reservation, you may be wondering what that means for your current mortgage rate. Loans that were previously reserved must adhere to the existing rate on the loan. This may be good news if you have a rate that you were happy with locked in!
MSHDA reservations that are expired or are expiring soon will be extended to the worst-case scenario rate. Any property changes made to your reservation will require a new reservation at the rates listed above.
Who can Qualify for MSHDA Down Payment Assistance Loan?
Buyers who are buying their first home or repeat buyers who haven’t owned a home in three years may be eligible for down payment assistance through MSHDA programs.
Some other qualifications include:
- A minimum credit score of 640 is required
- All adults who intend on living in the home must co-apply and meet the 640 minimum credit requirements
- The sales price limit of the new home is $224, 500
- Borrowers must contribute a minimum of 1% of the sales price
- Homebuyer Education Class is required
Read All Requirements: What Are the Requirements for a MSHDA Loan?
Get Started With a MSHDA Down Payment Assistance Loan
If you’re interested in the MSHDA DPA loan, you will need to consult with a MSHDA approved lender and not all lenders are approved for this type of loan product. Julie Krumholz is a MSHDA approved lender with over 30 years of experience in the mortgage industry. Her office is located in Rochester, Michigan at Superior National Bank.
