Detroit Down Payment Assistance Program: Who Qualifies and How to Apply

How the Detroit down payment assistance program works

Detroit first funded its down payment program with federal pandemic recovery (ARPA) money to help renters in the city become owners. The city says nearly 800 residents (794 at the March 2026 relaunch) have bought homes with it so far. Round 3 opened on March 11, 2026, under Mayor Mary Sheffield, and is funded with federal Community Development Block Grant money, including disaster recovery funds tied to the 2023 floods. That is why flood-affected households get priority this round.

The money is paid at closing, straight to the title company. You never get a check. The award is sized to your actual gap, so two buyers can get very different amounts. The city’s materials say assistance can go toward:

• The down payment itself.
• Closing costs, such as lender, title, and appraisal fees.
• Prepaid items, like the first year of homeowners insurance and property tax escrow.
• An interest rate buy-down, which lowers your monthly payment.

The award is not automatic and $25,000 is a ceiling, not a promise. Earlier rounds also capped total help at 50% of the purchase price, which matters on very low-priced homes. The city lists the program as once in a lifetime per buyer.

You still need a regular first mortgage from a participating lender. The grant fills the gap between what the lender will finance and what you need at the closing table. It does not replace the loan, and it does not lower the price of the house.

Eligibility rules in plain language

The rules below come from the city’s program pages, application packet, and its March 2026 announcement. The city updates its guidelines between rounds, so confirm each one on detroitmi.gov or with your counselor before you sign anything.

• First-time buyer: you cannot own a home now or have owned one in the past three years.
• Detroit residency: you must have lived in the City of Detroit for the last 12 months. The city also accepts people who can prove they lost a Detroit home to property tax foreclosure between 2010 and 2016.
• Income: household income at or below 80% of the area median income (AMI), explained in the next section.
• Your own money: a minimum contribution of $1,000 toward the purchase.
• Affordability: your housing payment must stay within a set share of your income. The application lists a 35% housing expense ratio, while the March 2026 announcement mentioned 30% payment to income. Ask your lender which test applies to your file.
• Education: complete a homebuyer education course with a HUD-approved counseling agency before closing.
• The home: must be in Detroit and be your main residence. Ask whether duplexes, condos, or land contracts are allowed in the current round.

Two questions to ask early, because the answers have changed between rounds: is the award a straight grant or a forgivable lien, and do you have to live in the home for a set number of years? If you sell or move out early, part of a forgivable lien may have to be repaid.

Income limits and the 80 percent rule

“80% of AMI” means your household’s total gross income cannot be more than 80% of the median income for the Detroit area, adjusted for household size. HUD publishes these figures each spring, and the city posts its own table with the application. Coverage of the 2026 round put the base Detroit-area median at about $102,700, which works out to roughly $82,160 at 80% for a family of four. A 2026 city post listed a lower limit for a one-person household, about $56,600. Because these numbers shift each year and by household size, use the table on the current application rather than any figure you see online, including ours.

Income counts everyone 18 and older who will live in the home, not just the people on the loan. Lenders typically look at pay stubs, two years of tax returns, Social Security or pension letters, and any child support you receive. If you are close to the line, a HUD-approved counselor can help you check the math before you pay for an appraisal.

Michigan’s MI 10K DPA and MI Home Loan

The Michigan State Housing Development Authority (MSHDA) runs its own help for buyers across the state, including in Detroit. The two pieces work together:

• MI Home Loan is MSHDA’s 30-year fixed-rate first mortgage, offered through participating lenders. MSHDA lists a minimum credit score of 640, a statewide sales price limit of $566,355 after June 1, 2026, and income limits that vary by county and household size.
• MI 10K DPA is a second loan of up to $10,000 for the down payment, closing costs, and prepaid items. It must be paired with a MI Home Loan. It carries 0% interest and no monthly payment; it is repaid when you sell, refinance, or pay off the first mortgage.

MSHDA also requires a homebuyer education class. Michigan’s housing education locator lists approved agencies and also helps you find a participating lender. One class can often satisfy both the city and MSHDA, but confirm that before you enroll.

Can you use the city grant and the state loan on the same purchase? Some buyers have, but it depends on the lender, the first mortgage type, and the rules of the round. Ask any lender you interview, “Do you close Detroit DPA files with a MI Home Loan and the MI 10K DPA?” A lender who has done both will know the paperwork order.

Detroit buyer programs side by side

Figures were checked on November 2, 2026. Program money runs out between rounds, so treat every row as “if funding is open.” To estimate a monthly FHA payment, try our FHA loan calculator.

Buying a Detroit Land Bank home

The Detroit Land Bank Authority owns thousands of city properties and sells houses to the public. Its main channels are online auctions, where homes are listed for bidding, and “Own It Now” listings sold at a set price. Most of these homes are sold as-is and need real repair work, so many buyers pair them with a renovation mortgage and a careful contractor estimate.

The Land Bank also sells fully renovated “Rehabbed & Ready” homes. In 2024 it announced a Rehabbed & Ready down payment assistance program with National Faith Homebuyers and a $200,000 commitment from the Rocket Community Fund. Its rules included 12 months of Detroit residency, income under 120% of the MSHDA limit for Wayne County, a $1,000 buyer contribution, a 35% housing expense cap, homebuyer education, and living in the home for three years. That pool was small, so ask the Land Bank whether any money remains before you count on it.

A Land Bank home can still be paired with the city’s down payment grant if you meet both sets of rules and your lender agrees. Budget for an inspection even on a rehabbed house.

Applying, from first call to closing

The city’s process has stayed fairly similar across rounds. Expect it to take several weeks, and longer during busy spring months.

1. Check the round. Go to detroitmi.gov, open the Housing and Revitalization Department’s Homebuyers section, and read the Down Payment Assistance page. It shows whether applications are open and links the eligibility survey.
2. Take the eligibility survey. It screens for residency, prior ownership, and income. Keep a copy of your answers.
3. Book homebuyer education. Use a HUD-approved agency. You can search the HUD housing counselor list or call 800-569-4287. Counseling is free or low cost.
4. Get pre-approved by a participating lender. The city works with a list of partner lenders. Ask each one about rates, lender fees, and how many Detroit DPA files they have closed.
5. Gather proof. Typical items are ID, 12 months of Detroit addresses (leases, utility bills, or tax documents), income records, and bank statements showing your $1,000. Our documents checklist covers the general paperwork.
6. Find a home and sign a purchase agreement. Your agent and lender then submit the DPA request with the agreement.
7. Appraisal, inspection, and approval. The city and lender review the file. Do not change jobs, open new credit, or move money around during this stretch.
8. Close. The grant is wired to the title company, and you sign your mortgage and any DPA documents.

A worked example

Here is a simplified example, not a quote. A single parent who has rented on the east side for four years earns $48,000 a year and finds a $115,000 house. With an FHA loan, the minimum down payment is 3.5%, or $4,025. Closing costs and prepaid items might add roughly $6,000 to $8,000, depending on the lender, title fees, and the escrow the lender collects.

That buyer might need about $10,000 to $12,000 in cash at closing. After the required $1,000 contribution, a Detroit DPA award could cover most or all of the rest, and some buyers use part of the grant to buy down the rate. Whether that actually happens depends on the round’s rules, the appraisal, and the lender’s numbers. The point is that the grant is sized to the gap, so a cheaper house or a lower-fee lender does not leave money “on the table.”

Costs the grant does not cover

Down payment help gets you through closing. It does not pay the bills that come after. Before you commit, budget for:

• Property taxes. Detroit’s rates are among the highest in Michigan. Low-income owners can apply each year for the city’s Homeowners Property Exemption (HOPE), which can cut or remove the tax bill.
• Homeowners insurance. Detroit premiums can be high. Get quotes before you make an offer.
• Repairs. Older roofs, furnaces, and sewer lines are common in the city’s housing stock.
• Water and utilities. Owners take over bills that a landlord may have paid.
• Inspection and appraisal fees, which are often paid before closing.

A strong credit file lowers your rate, which matters more over 30 years than a one-time grant. If your score is near MSHDA’s 640 minimum, see our guide on how to increase your credit score for a mortgage.

What if I do not qualify for Detroit DPA?

Missing one rule does not end your path to owning. Common situations and next steps:

• You moved to Detroit recently. Wait until you pass 12 months, and use the time for counseling and savings. MSHDA’s MI 10K DPA has no city residency rule.
• Your income is above 80% of AMI. MSHDA’s limits are usually higher. Ask a lender to check the MI Home Loan limit for Wayne County.
• Funding is closed. Rounds open and close. Ask a HUD-approved counselor to tell you when the next round opens, and keep your documents current.
• Your credit is the barrier. Free counseling can build a 6 to 12 month plan. Compare options in our down payment assistance guide.
• You work as a teacher, police officer, firefighter, or EMT. HUD’s Good Neighbor Next Door program sells some homes at half the list price in revitalization areas.

The Consumer Financial Protection Bureau’s buying a house guide walks through loan estimates and closing documents, which helps you compare lenders fairly.

Related guides

• Michigan mortgage relief program
• Down payment assistance program
• FHA loan calculator
• Good Neighbor Next Door

Frequently asked questions

This guide is general information, not financial or legal advice. Award amounts, income limits, and funding rounds are set by the City of Detroit and MSHDA and can change. National Relief Program is an independent website and is not affiliated with the City of Detroit, MSHDA, the Detroit Land Bank Authority, or any government agency.