Buying a house when you’ve got student loan debt might seem impossible. Plenty of news reports make it sound that way. Here’s the good news you haven’t been reading.Full Article
Down payment assistance is everywhere. Here’s how to find a program near you
How does $12,000 sound?
If you think down payment assistance is a scarce commodity, you’re wrong. You’re also not alone. A NeighborWorks America survey found that 70 percent of adults are unaware that down payment assistance programs are available to homebuyers in their community. In fact, there’s all kinds of help out there—it’s just hard to find. And it’s real help, averaging almost $12,000, according to Down Payment Resource (DPR).
That’s DownPaymentResource.com. Bookmark it. This growing, award-winning service, the only one of its kind, is all about making down payment assistance (and other homebuyer programs) way easier to find.
DPR, where have you been all our lives?
Where the heck is all this money?
First of all, if you don't know this yet, you don't need 20 percent down to buy a home. In some cases, as we noted in a previous post, you can put as little as 3.5 percent down. And even that doesn’t necessarily have to be your money. Great! The problem, though, is finding that money, because the world of down payment assistance is downright byzantine.
There are more than 2,300 homeownership programs around the country, says DPR president and CEO Rob Chrane. And they’re administered by all manner of government, quasi-government, and nonprofit agencies at the federal, state, county, and city levels.
“It's so fragmented,” Chrane says. “There was no single database where all this information was collected and updated and put into easy-to-use tools to help match eligible buyers and eligible properties with these programs.”
Even real estate professionals can’t keep up with it, he says. “There's some lenders that specialize, there's some realtors that specialize, but it's a small sliver.”
The need for a complete database—among professionals and homebuyers alike—was obvious to Chrane, who has been an agent, a broker, and a lender during the course of his career. So he launched DPR in 2010. In 2011, DPR won the Inman News Innovator award for “Most Innovative New Technology.”
Get matched with money and homes, online
DPR continually monitors homeownership programs nationwide, along with the ever-changing eligibility requirements for both properties and buyers. More than half of the programs in the DPR database fall under the category of down payment assistance, Chrane says. The rest are first-mortgage products, closing cost assistance programs, and other, sometimes obscure, programs.
DPR’s core customers are actually real estate pros—multiple listing services, agents, and lenders, says Chrane. “Where it really is powerful is when an MLS licenses this product from us. Then all of their members, real estate agents and brokers, have the ability to flag listings on their public websites. Obviously, our goal is to make it ubiquitous.”
If your real estate pro isn’t signed up, though, don’t worry: you can access the database yourself through DPR’s public website.
Based on information you supply via an online form, DPR can show you which programs you might qualify for, and the specific properties you can buy with them. You may be pleasantly surprised by the selection of properties: Chrane has found that, on average, 70 percent of listings are eligible for some kind of homebuyer assistance program.
The buyer always has to meet certain eligibility requirements, says Chrane. In terms of the property, there’s almost always a maximum sales price—sorry, no million-dollar ski chalets—and some geographical or other boundary. “It might be a state program, or city or county. Some of the programs are as specific as a neighborhood or a tax allocation district or a targeted census track.”
Says Chrane, “I think it's always good for people to ask their agent, Do you use Down Payment Resource? Do you have that tool available? Not every agent has it available to them. Not every agent who has it necessarily uses it. I think we all need to be accountable for our own selves, so that's why I would always say go to the public site yourself and use that freely, because we want consumers to be empowered with that information.”
We’ll second that.
Next time, more from Rob Chrane on how down payment assistance programs have expanded and the unexpected ways you could qualify.