If you were walking down the sidewalk and saw a $50 bill on the ground, would you bend over and grab the free gift? For most people, the answer would be, “absolutely.” For the typical first time home buyer, the amount of money available as a free gift towards the purchase of their first home averages $11,565 nationwide, just in the form of down payment assistance. For some counties, that figure is actually over $35,000 per buyer.
Realtor.com shares the details:
There are 2,290 down payment programs across the country waiting for home buyers to apply for funds, according to a joint analysis recently issued by RealtyTrac, a real estate data provider, and Down Payment Resource, a purveyor of home-buyer assistance programs. The average amount of down payment assistance per buyer is$11,565, according to the analysis.
“It’s important for buyers to research down payment programs as part of their loan shopping process,” said Rob Chrane, president and CEO of Down Payment Resource. As a former Realtor® turned mortgage lender turned entrepreneur, Chrane started DPR to help bridge the gap between these programs and the home buyer.
The problem is, few people know his company exists—let alone that there is money out there to help them become homeowners.
“There’s a lot of missed opportunities here,” he said.
Of the 78 million single-family homes and condos in the United States, more than 68 million, or 87%, would qualify for a down payment program, according to the report. Of course, not all of those houses are on the market. The report looked at parcels and matched them with county-, state-, and federal-level assistance programs.
In each of the 3,143 counties in this country, there is a down payment program available, according to the report.
The housing market is in the midst of recovery from its 2009 collapse. Houses are selling and prices are rising. Yet first-time buyers are largely absent from the recovery. Historically, they make up 40% of annual sales, according to the National Association of Realtors®. Last year, however, they accounted for 33%, the lowest level since 1987.
For many would-be buyers, saving for a down payment is a known barrier to entry. According to a sample of more than 900 randomly selected visitors to realtor.com in January, 12% said they lacked enough funds for a down payment. That proportion more than doubles to 26% of those who identify themselves as first-time buyers, according to Smoke.
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