LANSING, Mich. — Buying a house is often the biggest investment young people make, often more than paying for a college education. A new program, sponsored by Sen. Ken Horn, helps ease the financial burden of a down payment for first-time buyers.
Michigan already offers a savings plan with incentives to save for college. Senate Bill 145, which was signed into law by the governor on Wednesday, creates a similar savings program to help people save for the down payment and closing costs on their first home.
“I’ve worked on similar legislation over the years and we’ve continued to craft and improve it in ways that will help people purchase their first home,” said Horn, R-Frankenmuth. “The aim of this program is to promote smart homeownership and to retain talent in Michigan. It’s a tool we can use to encourage people to ultimately put down roots here in our state.”
First-time buyers setting up these accounts would be able to deduct up to $5,000 per year for a single filer or $10,000 per year for joint filers from their income if the money is used for a qualified home purchase.
“Homeownership creates opportunities for Michigan families and sets a foundation for economic success,” said Gov. Gretchen Whitmer. “I am proud to sign this legislation which will put Michiganders first by helping families save for and purchase homes.”
Horn agreed and added that this program has been used successfully in other states and that the program will be another tool to help Michigan families.
“Purchasing a home is a major step in anyone’s life and saving for a down payment and other closing costs is a huge barrier of entry to homeownership,” Horn said. “This legislation will provide a bit of relief to those working toward one of life’s biggest milestones.
“We’ve seen this model used successfully in other states when it comes to retaining and attracting talent, and I’m excited to add it to our toolbox here in Michigan.”