Detroit and the surrounding metro area offer a relatively affordable housing market, giving people a real opportunity to achieve homeownership and build generational wealth. However, that opportunity is not without challenges. Rising home prices—which continue to outpace local income growth—along with high property tax rates and insurance costs, can create significant financial hurdles for buyers.

To help overcome these costs, a variety of down payment assistance programs are available across Metro Detroit and Michigan. By combining resources like state programs from the Michigan State Housing Development Authority (MSHDA) with local bank grants and municipal initiatives—such as the City of Detroit’s Down Payment Assistance Program offering up to $25,000 for eligible buyers—homeownership becomes far more accessible.

To fully benefit from these opportunities, buyers need a level playing field free from improper costs and unfair barriers. To understand how discrimination can occur at different points in the home purchase process, including by lenders, real estate professionals, and sellers.

1. Lenders

Under the Equal Credit Opportunity Act (ECOA) and state and local fair housing laws, lenders cannot discriminate based on demographic categories like race, color, religion, national origin, sex, marital status, age, disability, or receipt of public assistance.

Examples:

• Marital and Family Status: A lender cannot demand a co-signer or deny a loan simply because an applicant is pregnant, or planning to start a family, provided the applicant independently qualifies.

• Age Restrictions: As long as they have the “capacity to contract,” lenders cannot require co-signers for younger applicants (such as buyers in their early 20s) who otherwise meet income and credit requirements, nor can they penalize senior citizens based on assumptions about retirement.

• Appraisal Bias: It is unlawful for an appraisal to consider the race or protected class demographics of the buyer, the seller, or the surrounding neighborhood.

• Disability Accommodations: Lenders may be required to provide reasonable accommodations to allow disabled individuals equal access to the lending process, such as offering flexible application procedures or alternative communication methods.

2. Real Estate Professionals

Real estate professionals play a major role in helping buyers navigate the market, but discrimination can still occur during these interactions. A three-year investigation of real estate agents in Long Island New York showed the prevalence of racial discrimination by real estate agents, including "steering" and varying service levels.

Examples:

• Differential Treatment: Requiring pre-approval letters or proof of funds from buyers of color before showing them properties, while taking other buyers out to viewings immediately.

• Steering: Directing buyers toward or away from specific neighborhoods based on race, national origin, or religion rather than stated housing preferences and budget.

• Accommodating Clients with Disabilities: An individual with a learning disability, severe anxiety, or depression might help going over the paperwork or additional time to process complex legal documents before signing.

3. Sellers

Sellers are also required to comply with fair housing laws. Examples of discrimination by home sellers include:

• Selective Sale Practices: A seller choosing or refusing to sell to a buyer based on their protected class category, such as selecting a buyer solely because they share the seller's religious or cultural background.

• Inaccessible Showings: Failing to permit reasonable accommodations during home viewings, such as allowing a mobility impaired buyer to keep their shoes on or permitting a service animal into a home with a "no pets" policy.

Note: Third Parties

It is also important to pay attention to the actions of third-party service providers that are involved in the purchase process, such as home inspectors or insurance representatives recommended by an agent. Harassment or derogatory comments regarding your demographic background, including age, disability, or gender are unacceptable and can be unlawful.

Predatory Practices & Housing Scams

Predatory lending and scams are particularly common in the Metro Detroit area. Seniors, immigrants, non-English speakers, racial minorities and others may be targeted based on their perceived lack of awareness of their rights or a believe that they will not report violations to the authorities.

Common Traps to Avoid:

• Predatory Loans & Inflated Interest Rates: Being offered subprime loan products, or mortgages with excessive closing costs, or inflated interest rates based on demographic assumptions rather than creditworthiness.

• Fake Sales and Listings: Fraudulent sellers taking cash payments for homes they do not actually own or have the right to sell.

• Risky Land Contracts & Seller Financing: Entering rent-to-own or seller financing agreements where the buyer pays significantly above market value, absorbs heavy repair expenses, or ultimately doesn’t receive clear title or official transfer of ownership into their name. Transactions where the seller offers financing aren't always predatory or unreasonably expensive but you may want to do your due diligence, to be sure.

How to Protect Yourself

Take the following steps to avoid and address discrimination, scams and unethical business practices during the home purchase process:

• Work with a Trusted Real Estate Agent: A qualified agent can help you identify non-standard terms or red flags.

• Always Use a Title Company: Never complete a purchase (including cash deals, short sales, or seller financing) without a reputable title company verifying clear title and transfer of ownership.

• Prefer a Warranty Deed: When purchasing with cash, land contracts, or seller financing, try to secure property transfer with a Warranty Deed (rather than a Quitclaim Deed) and verify with the county that the deed is officially recorded in your name.

• Shop Around for Lending: Compare interest rates, fees, and closing costs across multiple financial institutions to help ensure that you’re receiving fair, market-rate pricing. Make sure you understand all of the fees on your loan estimate and question any that seem unreasonably high.

• Appeal Unfair Appraisals: If an appraisal appears artificially low, review the report language for improper comments about the race or other irrelevant information about the homeowner or neighbors. You can work with your lender to submit a formal appeal or Reconsideration of Value (ROV).

• Seek Legal Counsel: If you are unrepresented or entering a non-traditional sale (such as a land contract), or if you simply want a legal opinion about your transaction, consult a real estate attorney to review contract terms before finalizing a purchase.

Protecting Your Rights

If you think you are being discriminated against, targeted by predatory practices, or treated unfairly during your home search, taking good notes is essential to exercising your rights. Keeping detailed records gives you the information needed if you decide to make a complaint. Be sure to write down dates, names, and key details of interactions, take screenshots of text messages, and save all relevant emails and documents.

Keep in mind that strict legal deadlines apply for filing formal complaints. You have 180 days from the date of the incident to file a complaint with the Michigan Department of Civil Rights (MDCR) or with local REALTOR associations for code of ethics violations. If you are filing through the U.S. Department of Housing and Urban Development (HUD), you have one year from the date of the incident to submit your claim.

We're Here to Help

You don't have to navigate these issues alone. You can always reach out to us through this website or call us at 313-579-FAIR. We can help you understand your rights under the law, evaluate whether a situation may be discriminatory or predatory, and explore your legal options for taking further action or filing a complaint.