MSU FCU First Michigan CU to Be Authorized to Offer MSHDA Loans

EAST LANSING, Mich. – Michigan State University FCU has become the first credit union in Michigan to be authorized by the state to offer Michigan State Housing Development Authority (MSHDA) loans. MSHDA makes low-interest mortgage loans available for new and existing homes, condominiums and manufactured homes. The maximum income limit for metropolitan areas such as Ingham and Oakland counties is $56,650. Fixed-rate and step loans are lower than current market rates and offer up to 30-year terms. The maximum price is $128,000 for new homes and $105,000 for existing homes. MSU FCU VP of Marketing Joyce Banish said the credit union acts as a “facilitator” in the loan transaction – a member applies for the loan through the credit union which handles the processing of the loan application, but the state funds and services the loan. “There is a tendency by financials not to offer MSHDA loans because they’re very labor intensive,” Banish explained, referring to the amount of paper work applicants have to complete. “MSU FCU decided to offer the loans because we have a young membership and many of them are starting out in their first home and fall into the income requirements for the loan. So this is a great deal for them,” she said, adding that interest rates on MSHDA could be a full percentage point lower than on regular 15- or 30-day loans. There are also lower closing costs and downpayment requirements. The first MSHDA loan financed by MSU FCU allowed the members to finance their home with only 3% down and a 30-year mortgage with a rate less than 5%. “These loans will help get members into homes who couldn’t otherwise get in,” she said. So far MSU FCU has processed 20 applications for MSHDA loans. -