By KIMBERLEY HAAS
Attention lenders and real estate professionals: Did you know there are more than 2,000 homeownership programs available in the United States and over 38% of them are for repeat homebuyers?
That’s according to leaders at Down Payment Resource. They connect homebuyers with down payment help while providing tools for housing professionals.
Founder and CEO Rob Chrane recently sat down for an interview with The Mortgage Note. He said they are working hard to spread the word about these programs.
Chrane said across the MLS markets they have information for, about 70% of for-sale listings are eligible for one or more down payment assistance programs.
“The majority of homebuyers, or especially first-time homebuyers, just don’t know that this exists. If a consumer doesn’t know, then it’s kind of up to their real estate agent or their lender to tell them about it, but not every lender works with these programs, and not every real estate agent knows about them,” Chrane said.
He said depending on the market, 60% to 70% of FHA borrowers are eligible for programs, and only 15% of borrowers use them.
“That’s a huge gap. And again, it comes back to that lack of education. Our vision for this business from the beginning was that everybody and anybody who aspires to homeownership can know that down payment assistance is available and how to find it,” Chrane said.
Chrane said these programs can be used for conventional mortgages as well.
On the company’s website, potential homebuyers can look up programs in the specific area they want to purchase property.
For example, if a couple with two children wants to buy a home in Manchester, NH, one of the country’s hottest housing markets, they can use downpaymentresource.com to put in basic information to see what they could qualify for.
At the median household income of $62,087, if they looked for a loan on the median sold home price of $417,500, they could be eligible for 17 programs and up to $22,000 in down payment help.
Chrane said they are also working with industry leaders such as Redfin and Zillow so potential homebuyers can find down payment assistance and affordable lending programs that may be available to them.
In October, leaders at Redfin announced they added down payment assistance information to home listings on their website.
“Nearly half of Americans who have never owned a home say that saving money for a down payment is a barrier to homeownership, and many young people in particular feel like they’ll never be able to own a home,” Christian Taubman, Redfin’s Chief Growth Officer, said in a statement.
Taubman added, “Down payment assistance programs can make homeownership more attainable, but information about them is often fragmented and hard to understand. We saw a big opportunity in partnering with Down Payment Resource to raise awareness about these programs to help more people become homeowners.”
In December 2021, leaders at Zillow announced a similar partnership with Down Payment Resource.
“Down payment assistance programs provide a viable pathway to homeownership, which can help build generational wealth and economic opportunity for many that may not have been able to imagine it for themselves. Information is power, and Zillow is proud to partner with Down Payment Resource to shed more light on these important programs,” said Grace Chung, Zillow’s Director of Social Impact.
As the housing market cools, lenders are looking for ways to make the home buying process easier for potential customers.
Some mortgage companies are offering no down payment, no closing cost options to potential homebuyers.
In August, Bank of America introduced zero down payment, zero closing cost mortgages for first-time homebuyers in underserved communities.
Leaders at Lenders One Cooperative are planning to open branch locations at select Walmart stores in seven states.
President Justin Demola said in a recent interview with The Mortgage Note that opening branches inside Walmart stores makes sense for their members and customers who will have access to lending services in the same place they shop.
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