Down Payment Assistance Program - Up to $500,000 - No Monthly Payment & No Interest

From Sotheby's International Realty's in-house Lender Simon Atik, 310.880.8414, Simon.Atik@grarate.com, Vice President of Mortgage Lending, Guaranteed Rate Affinity.

Get Up To 20% Down Payment Assistance!

I can now provide your buyers additional purchase money by up to 20% or $500,000 towards their down payment. Our new Down Payment Assistance product (called Equity Down) will match the borrower’s down payment by allowing us to contribute to your client’s down payment. The amount is customizable and can range anywhere between 5% to 20%, up to $500,000! And the best part: there is NO monthly payment and NO interest rate on this money! This means you can add 10% or 20% additional down to the deal, increasing their buying power up to 18%, without any additional hit to your client’s debt ratio. This is a game changer.

Just Some Ways This Helps Your Clients:

  • Additional down to compete against multiple offers
  • Has only 10% but wants to avoid a 2nd loan or Mortgage Insurance
  • Debt ratio is too high to qualify for the purchase
  • Lowers monthly payment up to 25% against traditional 2nd loans
  • Want to increase their buying power but has no additional cash
  • Wants to conserve their cash for home improvement or emergencies
  • Increase your client’s buying power by up to 18% with no additional payment
  • Provide a larger inventory for your clients to choose from
  • Less reserves required as there’s no payment hit on the additional down

Program Overview

The Down Payment Homebuyer Program (Equity Down) offers borrowers a home ownership investment, as opposed to a loan.  The program invests in a buyer’s home and shares in the appreciation and the depreciation.  This program is a good option for borrowers who need extra down payment to avoid mortgage insurance (MI) and to reduce payments.

Program Basics

  • Borrower must typically contribute 10% of the loan
  • Program will contribute up to half of the down payment on a home purchase
  • Freddie Mac Conforming Fixed (max contribution 14.25%)
  • Non-Conforming Fixed (max contribution lower of 20% or $500,000)
  • Borrower must match contribution from their own funds
  • Equity share is 3.5% per 1% contribution
  • Program only shares in appreciation of property; does NOT share in appreciation due to borrower equity buy down or due to remodeling/renovation
  • Must hold loan for minimum 3 years
  • Property address must be approved prior
  • Offers no interest or payments for up to 30 years
  • Client can sell their home at any time or buy out loan after 3 years
  • Transaction fee of 2.5% of contribution amount at close of escrow

Freddie Mac Guidelines (Conforming)

  • 30, 20 and 15 year Fixed only
  • Min FICO:  680
  • Gift funds require minimum mid-FICO of 720
  • Max DTI:  45%
  • Max LTV:  80%
  • Max CLTV:  90%
  • Purchase or Rate/Term Refinance (no cash out)
  • Owner Occupied Primary Residence
  • Non-occupant co-borrower will be considered on an exception basis only
  • Non-occupant must be closely related with a minimum mid-FICO of 720
  • Bankruptcies, foreclosures and short sales must have been discharged for minimum of 5 years
  • Non-permanent resident aliens not allowed
  • Seller credit limited to 6% - regardless of LTV
  • Seller credit cannot be applied toward any Unison fees
  • No rural, 20+ acre properties, coops, or rentals

 Jumbo Guidelines (Non-Conforming)

  • 30 Year Fixed Only
  • Primary Occupancy
  • Purchase
  • All parties that intend to hold title must apply for Program
  • No tenants in common or co-op properties
  • No rural properties
  • No atypical properties for the area
  • No properties >10 acres
  • Applicants must occupy property as their primary residence
  • Exceptions possible on a case-by-case basis

Please contact me for more detailed information.