Getting a Mortgage in Michigan: 2026 Guide

The Detroit suburbs in Oakland and Macomb counties anchor a meaningful slice of Michigan's mortgage volume, with higher pricing in the Birmingham, Bloomfield Hills, Troy, and Rochester corridor than in most of the state. Detroit itself has a wide spread of price points, with active first-time buyer and investor activity in many neighborhoods.

Grand Rapids and West Michigan have been one of the fastest-growing parts of the state. Ann Arbor (Washtenaw County) is anchored by the University of Michigan and carries higher pricing. The Lansing area, Kalamazoo, and the Upper Peninsula each anchor smaller markets at lower price points.

Michigan's principal residence exemption (PRE) materially reduces the school operating tax on an owner-occupied principal residence, but the exemption is not automatic and must be filed.

For 2026, the conforming one-unit loan limit in every Michigan county is $806,500 and the statewide FHA one-unit floor is $524,225. There are no high-cost designations anywhere in Michigan.

Higher-end Oakland County and Ann Arbor contracts can push into jumbo territory above the conforming cap. Across the rest of the state, the floor figures apply.

Michigan's effective property tax rate runs around 1.38% of market value statewide, in the upper-middle of the national range. Local millage rates vary by school district and city. The principal residence exemption (PRE) reduces school operating millage on an owner-occupied principal residence, which materially lowers the tax line versus a non-PRE property.

Always pull the actual local tax line for the specific parcel and confirm that the PRE is on file. Proposal A caps annual taxable-value growth on a property held by the same owner; on transfer, the taxable value is uncapped to the assessed value.

The Michigan State Housing Development Authority (MSHDA) runs the dominant first-time buyer first mortgage program family in the state. The MI Home Loan program pairs a discounted-rate first mortgage with optional MI 10K DPA Loan down-payment assistance for income-eligible buyers.

The MI Home Loan Flex program is available to a slightly broader set of buyers (including some non-first-time buyers in target areas). MSHDA also issues a Mortgage Credit Certificate (MCC) for federal tax credit on a portion of mortgage interest. Funding and parameters are reviewed periodically.

Michigan has steady eligible-veteran demand statewide, with concentration around Selfridge ANGB (Macomb County) and the broader Detroit, Grand Rapids, and Lansing metros. The 2026 VA county loan limit in every Michigan county matches the conforming baseline of $806,500.

VA funding fee on a no-down-payment first-time use is 2.15% of the loan amount; subsequent use without a down payment is 3.3%. Borrowers receiving VA disability compensation are exempt.

Plan for buyer-side closing costs of roughly 2 to 3% of the purchase price in Michigan, plus prepaid escrows. Michigan charges a state real estate transfer tax of $3.75 per $500 of consideration plus a county transfer tax of $0.55 per $500, customarily paid by the seller.

Standard purchase closings run 30 to 35 days. Michigan is primarily a non-judicial foreclosure state under the foreclosure-by-advertisement procedure.