Important Questions for Your Mortgage Lender
Quarterly Homeownership Program Index debunks five down payment myths
Number of programs increase to more than 2,400
ATLANTA, GA, October 7, 2015 –Atlanta-based Down Payment Resource, the nation’s only databank for homebuyer programs, released its Third Quarter 2015 Homeownership Program Index. The volume of programs increased to more than 2,400, making it the fourth consecutive increase in programs.
The index reveals the wide range of homeownership opportunities available for homebuyers across the country. Recent surveys, including the America at Home survey by NeighborWorks America, show that consumers have the desire to buy, yet many are unaware of all their home financing options, the home buying process and may overestimate the down payment and home maintenance costs.
“Today’s consumers are motivated to buy, but the down payment continues to be a primary obstacle. Most homebuyers don’t know to look for or ask about homeownership programs that could help them both in the short and long term. The requirements and benefits of programs vary greatly and may help buyers save on their down payment and closing costs, gain a lower interest rate or enjoy a healthy tax credit for the life of their loan,” said Rob Chrane, CEO of Down Payment Resource.
Five misconceptions about down payments may be keeping buyers on the sidelines for longer than necessary.
Myth 1: Programs are only for first-time homebuyers. While first-time homebuyer programs may be common, it’s important to note that the definition of a first-time homebuyer is someone who has not owned a home in three years. In addition, the index finds that 37 percent of programs do not have a first-time homebuyer requirement.
Myth 2: Homeownership programs make financing more difficult. There are now more than 2,400 programs available across the country and 85 percent have funds available for homebuyers. It’s important for new buyers to seek homeownership education. It’s often a requirement for down payment programs and it gives buyers confidence with the home buying process, financing options, including down payment programs, and budgeting.
Myth 3: You need to put 20 percent down. Today, a 20 percent down payment is not required and depending on the buyer’s situation, it may not be optimal. Homeownership programs allow buyers to save on the down payment and retain savings for home maintenance and improvements. Today’s programs include grants, first mortgages with below-market interest rates and annual tax credits.
Myth 4: Programs aren’t available in my area. There are programs available in every community across the country – rural and urban. It’s important for buyers to search for programs early in their home buying journey because it may help determine the most affordable part of town or price point.
Myth 5: It’s too expensive to buy in my market. More than 14 percent of programs are designed for individuals providing an important community service, including educators, protectors, healthcare workers, veterans and other special circumstances. Especially helpful in high cost markets, the programs help workers live in the community they serve.
About Down Payment Resource’s Homeownership Program Index
The Homeownership Program Index (HPI) measures the availability and characteristics of down payment programs administered by state and local Housing Finance Agencies (HFAs), nonprofits and other housing organizations. It analyzed state, local and national programs available in the DOWN PAYMENT RESOURCE™ registry as of September 30, 2015.
About Down Payment Resource
Down Payment Resource (DPR) creates opportunity for homebuyers, Realtors and lenders by uncovering programs that get people into homes. The company tracks 2,400 homebuyer programs through its housing finance agency partners. Winner of the 2011 Inman News Innovator “Most Innovative New Technology” award, DPR is licensed to Multiple Listing Services, Realtor Associations, lenders and housing counselors across the country.
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Melinda Harris, Down Payment Resource, email@example.com
Download a PDF version of the release.