DACA mortgages in Michigan are here! On January 20th, 2021 the US Department of Housing and Urban Development (HUD) has announced that all immigrants under the Deferred Action for Childhood Arrivals (DACA) program will be eligible to apply for a Federal Housing Administration (FHA) backed mortgages. This new qualification for FHA loans is effective immediately.
What is a DACA Loan?
What is a DACA Loan? The main point of the DACA program is to defer deportation for those who were brought to the United States illegally as children for two years. This program allows recipients to gain authorization to work and to renew their license.
Then President Obama first established the DACA policy on June 15th, 2012 which is also the 30th anniversary for Plyler vs. Doe, a Supreme Court ruling which barred public schools to charge tuition to undocumented immigrants.
FHA Loans Eligible for DACA Program
With language in FHA guidelines stating that “Non-US citizens without lawful residency in the U.S. are not eligible for FHA-insured mortgages” created controversary with how DACA recipients are being handled with their mortgage needs because lawful residency pre-dated the establishment of DACA.
Due to this controversary and uncertainty, HUD announced in 2019 that the FHA will not provide mortgages to DACA recipients. Former HUD secretary Ben Carson in 2020 reversed the 2019 HUD statements and announced that no changes will be made to the FHA guidelines.
With many years of uncertainty on the guidelines of FHA eligibility with DACA recipients, HUD wants to avoid all confusion for lenders and borrowers by removing the full subsection in the guidelines in its entirety mentioned above.
Michigan DACA Loan Eligibility
The members of this program must be legally permitted to work in the U.S to qualify. This is great news for 700,000 plus active recipients in DACA. The remaining guidelines for eligibility for an FHA backed mortgage remain in effect:
- Borrower must complete all requirements and conditions as those for U.S. citizens.
- Borrower must have valid SSN card, exceptions for employees for the World Bank and foreign embassies.
- Borrowers must have a valid Employment Authorization Document (EAD) card that reflects Category C33
- Subject property must be the primary residence.
- Minimum credit score of 620.
- Minimum of 3.5% down payment.
- Debt to Income ratio must be less or equal to 43%.
- Must have proof of stable income and employment.
DACA Loans in Michigan are just like qualifying for a standard FHA Loan. Now that HUD has authorized lenders to approve DACA recipients, the dream of home ownership may be realized by more individuals.
Apply for a Michigan DACA Loan
Give a licensed loan expert at Riverbank a call at 800-555-2098 to review DACA Loan qualifications or request information below.