Atlanta, GA, February 18, 2016 – Atlanta-based Down Payment Resource, the nationwide databank for homebuyer programs, today released its fourth quarter 2015 Homeownership Program Index (HPI). There are now 2,406 homeownership programs available and 84 percent currently have funds available to prospective homebuyers, down one percent from last quarter.
The HPI found 63 percent of programs include a first-time homebuyer requirement. First-time homebuyers are defined as a buyer who has not owned a home in the past three years.
Across 15 percent of homeownership programs, specific incentives are available for community heroes. These programs include special benefits for veterans, educators, protectors, firefighters, healthcare workers and disabled homebuyers.
A recent Bankrate.com survey found that almost a quarter of non-owners don’t know how much they would put down on a house. Only 9 percent of renters said they would put down 1 – 5 percent.
“Renter surveys reveal the lack of understanding among consumers about down payments and current requirements. It’s important for prospective buyers to research their home loan and down payment options,” said Rob Chrane, CEO of Down Payment Resource.
Significant programs updates
While the number of programs and funding remained steady, significant updates and edits were made to the programs included in Down payment Resource to ensure information is current for real estate professionals and homebuyers.
Updates made in Down Payment Resource in fourth quarter 2015:
- 5,134 specific changes were made across all programs
- 761 programs were updated with new information about guidelines, funding status and contact information
- 51 new programs were added
- 58 previous programs were expired, confirmed no longer available and removed
“This quarter’s Homeownership Program Index reveals the significant effort it takes to maintain the accuracy of our program databank. With thousands of changes occurring in the fourth quarter alone, we can be sure we have the latest information about funding status, contact information, coverage area and more,” said Chrane.
Down payment and closing cost programs make up 70 percent of programs: One common example is a second mortgage with a very low or no interest rate where the payment may be deferred or forgiven incrementally for each year the buyer remains in the home. For example, the homebuyer gets an FHA or conventional first mortgage and applies for a homeownership program that is a second mortgage funding the down payment. A percentage of the down payment is forgiven each year the buyer occupies the home.
Mortgage Credit Certificates (MCC) make up 8 percent of programs: An MCC program reduces the amount of federal income tax a homebuyer pays each year and it’s good for the life of the loan. It’s a tax credit, not a deduction, so it directly reduces the taxes owed, up to $2,000 annually.
First mortgage loans make up 9 percent of programs: These programs are home loans that may feature below-market interest rates, lower or no mortgage insurance, or 100 percent financing. Issued by housing finance agencies, these loans can be even more affordable than other first mortgage products and buyers may be able to layer them with other grants or down payment programs for even more savings.
Additional programs make up 13 percent of programs: These programs may include Employer Assisted Housing programs offered by employers in certain markets and Individual Development Accounts that provide a matching down payment savings program. Programs are often designed to meet specific needs of the community.
Where programs are available
There are 25 programs available nationwide. Regionally, the most programs are found in the South (942), followed by the West (728). View a complete list of state-by-state program data.
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. For more information, please visit www.DownPaymentResource.com and on Twitter at @DwnPmtResource.
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