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New Down Payment Resource Website Links Buyers with Assistance
First national website dedicated to linking buyers to information about the more than 1,500 down payment assistance programs available across the country
By: Down Payment Resource
Down Payment Resource (http://www.downpaymentresource.com)
Saving money for a down payment has long been recognized as a major barrier to homeownership, especially for first-time buyers who don’t have equity from an existing home to buy a new one. For example, more than half of prospective buyers (55.1%) in a recent national survey by Realtor.com said they are delaying their plans to buy in part because they lack the money for a down payment or closing costs.
Down payments have increased steadily over the past seven years. According to the National Association of REALTORS®, the median down payment for all home purchases, including those using FHA funding, was 9 percent in 2012, compared to an average of 4 percent in 2006, when 43 percent of first-time homebuyers purchased their homes with no down payment. Down payment requirements may increase further with the implementation of the pending Qualified Residential Mortgage (QRM) Rule by the Consumer Financial Protection Bureau.
“Hundreds of thousands, maybe millions, of renters could buy homes if they knew that down payment help was available, yet many of these programs go unnoticed because of limited marketing resources or because the information is not easily accessible. That is precisely why DPR was created—to better connect homebuyers with these important resources. In some cases, programs may even be layered for greater assistance,”
Programs on Down Payment Resource are both publicly and privately funded. Many are administered by local and state governments to encourage buyers to become homeowners in their jurisdictions.
These programs include:
· Soft second or third mortgages or grants are provided through municipal or quasi-government agencies and non-profits and provide benefits such as 0% interest rates and deferred payments. The assistance amounts range from a few to tens of thousands of dollars and can be used towards closing cost assistance, pre-paids, and/or principal reductions.
· Affordable first mortgages are typically offered by larger housing finance agencies, particularly at the state level, to accompany their down payment assistance program(s). These first mortgages often offer a below market rate and may even have reduced closing costs or reduced fees helping to lower buying costs and monthly payments.
· Tax Credit or Mortgage Credit Certificates (MCC) are designed to help first-time homebuyers offset a portion of their mortgage payment by providing a direct tax credit. Because it is a tax credit and not a tax deduction, mortgage lenders will often use the estimated amount of the credit on a monthly basis as additional income to help homebuyers qualify for the loan. The amount of mortgage credit allowed varies depending on the state or local government that issues the certificates, but is often capped at a maximum of $2,000 per year by the IRS.
To date, DPR has been available to Realtors and homebuyers in 14 markets through several leading Multiple Listing Services (MLS). When partnering with an MLS, DPR aggregates up-to-date down payment assistance information and integrates the details into listing data for homes currently on the market. The tool allows the agent or homebuyer to view an icon on any property listing that may qualify for a program. Homebuyers can click on the icon and complete a short, confidential survey to determine if they may also be eligible. Agents can also quickly view and share details about the assistance programs, as well as manage client details in a client portal.
MLSs that have licensed DPR include NorthstarMLS, Midwest Real Estate Data (MRED), My Florida Regional MLS, Mid-America Regional Information System (MARIS), Tucson Association of Realtors (TARMLS), Northern Nevada Regional MLS (NNRMLS), Northern New England Real Estate Network (NNEREN), Heartland MLS, North Carolina Mountains MLS, Southeast Minnesota MLS (SEMAR), First Multiple Listing Service (FMLS), and Austin/Central Texas Realty Information Services (ACTRIS). The California Association of REALTORS also uses DPR to power its California Mortgage Resource Directory (http://www.car.org/
Now, for the first time, real estate agents and homebuyers everywhere can quickly discover available program information through the new website. Mortgage lenders also can access information on local programs to find out how they can partner with real estate agents on down payment-assisted transactions.
About Down Payment Resource
Down Payment Resource (DPR) was developed by Atlanta-based Workforce Resource®, a web-based software company with a mission to connect people with hard-to-find financial resources for better living. DPR helps potential homebuyers become qualified buyers by connecting them to down payment assistance funds they may not have otherwise known existed. DPR, winner of the 2011 Inman News Innovator “Most Innovative New Technology” award, is available primarily through Multiple Listing Services and Realtor Associations in select markets across the country. For more information, please visit www.DownPaymentResource.com.