Posted On February 19, 2018
Saving for a down payment is one of the most commonly reported obstacles to homeownership and continues to slow down the home buying process for creditworthy borrowers. As rents and home prices continue to rise, almost every demographic, especially first-time home buyers, are experiencing difficulties in saving for a down payment.
To address this problem and facilitate homeownership, Fannie Mae is testing a new low down payment option across three major markets. Qualifying home buyers in St. Louis, MO, Philadelphia, PA, and Chicago, IL will have the option to purchase a home with 3% down.*
Programs like HomeFundItTM make it even easier to reach the 3% down payment. Through HomeFundIt, qualifying home buyers have the opportunity to crowdfund their down payment through contributions from family and friends.
With the low down payment option and HomeFundIt, more creditworthy home buyers have a chance to enter the market and make the dream of homeownership a reality. Where does the home buying journey begin?
Steps to Smart Homeownership
With the low down payment option, owning a home is more achievable than ever before. In addition to only requiring 3% down, gifts, grants, or funds from down payment assistance programs are all able to be used toward the down payment and closing costs. With HomeFundIt and the low down payment option, a prospective home buyer could crowdfund the entire down payment through the platform.
*Payment example: if you choose a $200,000 loan at a rate of 4.125% (4.324% APR), with a loan-to-value (LTV) of 97%. You would make 360 monthly payments of $969.30. Payment stated does not include taxes and insurance, which will result in a higher payment.