A zero-down mortgage without closing costs, fees or a credit check probably sounds too good to be true, but it's about to become a reality for some Detroit home buyers.
Mayor Mike Duggan Thursday announced a new mortgage program to make it easier to finance a home in the city.
This comes a year after the city launched an online auction site to help fill Detroit's vacant homes.
Duggan said mortgages have been an obstacle to the site's success.
"Last year, 4,000 people in Detroit bought a single-family home, and only 400 were able to get a mortgage," he said. "For 90 percent of the houses sold in the city, the buyer had to pay cash."
The city is teaming up with the Neighborhood Assistance Corporation of America (NACA) and Bank of America to create the Detroit Neighborhood Initiative.
Through the program, potential homebuyers can apply for mortgages with rates between 2.75 and 3.5 percent, including funding for renovations.
Bruce Marks, founder and CEO of NACA, said the Detroit-exclusive program is "historic."
"Where else can you have a fully renovated house, paying less than $400 [per month]? It doesn't happen." Marks said. "Except it's going to happen for many, many Detroit homeowners."
Marks said anyone who has a steady income and doesn't already own a property can apply for the loans.
"This is one of those things that may sound too good to be true, but it's reality," he said. "[NACA] has a track record of getting this done in 40 different cities across the country."
Buyers interested in the program must first attend a workshop before they can apply.
