Legislation heading to the governor's desk could increase access to home mortgages from a state program designed for low and moderate income people.
The bill is among a flurry of lame-duck legislation approved by the state Senate in late December.
Tonya Coon is Director of Homeownership for the Michigan State Housing Development Authority. She said the bill removes the program's mortgage cap of $224,500, something the agency has been working on for two years.
The cap made it extremely difficult for people to find a home to buy in today's more expensive housing market.
Coon laughingly called the passage of the bill a Christmas present.
"The cap has been set since 2009," Coon said. "Potential homeowners [have been] trying to get into a home and .... they're stuck. So this sales price bill is going to be really great — to be able help more Michigan homeowners be able to get into a home."
Instead of a fixed cap, the bill links the mortgage limit to an IRS index. Coon said she hopes the change will help homebuyers better compete with cash buyers, who've been purchasing many of the lower priced homes in the state, flipping them for resale after some renovations, or converting them to rentals.
The MDHHS program also offers eligible homebuyers a better interest rate as well as down payment assistance. Income limits to qualify for the program vary, depending on the county applicants live in.
