Do 21 Million Under 40 Renters Know Their Homeownership Potential?

Saving for a down payment is a considerable barrier to homeownership. With rising home prices and interest rates and tight lending standards, the path to homeownership has become more challenging, especially for low-to-median-income borrowers and potential first-time homebuyers.

Yet most potential homebuyers are largely unaware that there are low– and no–down payment assistance programs available to help eligible borrowers secure an affordable down payment.

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Report Recommends Raising Consumer Awareness of Down Payment Assistance

A new report on credit access and affordability by the Urban Institute’s Housing Finance Policy Center commissioned by Down Payment Resource and Freddie Mac shows how many homebuyers could have taken advantage of down payment assistance and other affordable lending programs in 2016.

The Barriers to Homeownership: Down Payments, Credit Access, and Affordability report  provides data and commentary on three significant barriers to homeownership: saving for a down payment, accessing mortgage credit and housing affordability.

The report also offers information about down payment assistance programs which can help borrowers overcome that barrier. It includes an interactive map of the U.S. which allows users to compare 16 housing market factors, including homeownership programs, between states.  keep reading

New Changes to Low Down Payment Mortgages: What You Need to Know

Recently, mortgage investor Freddie Mac clarified that it would not purchase certain low down payment loans that include lender contributions to the buyers’ down payment if they were funded through premium pricing.

Does this mean super low down payments are now a thing of the past?

No. This announcement only affects proprietary grant programs offered by specific lenders, like the ones listed in this HousingWire story.

These programs allow buyers to put only 1% down with the other 2% of the down payment provided by the lender. The new change will require the first 3% down to come from either the borrower’s personal funds and/or other eligible sources such as a gift from a family member or approved non-profit. keep reading