Are you a first time buyer in Dallas/Fort Worth looking for help saving enough for a down payment? You're not the only one. The struggle is real, as they say. But there's been a new trend of young buyers using creative ways to save enough money.  One way is through crowd sourcing, and it's a great and safe way to let friends and relatives help save for this important purchase.
How does it work? Let's say that when a young couple gets married, they invite the wedding gusts to forgo the traditional gift giving and instead contribute to a “Down Payment Fund." Most of the time a newly wed couple already has the items they need for a new home, as they have their own furniture and home items living separately, or together. Now all they need is the perfect present - a new home.
When you break down the math, it makes it even more clear why this is such a great idea. If you have a wedding and invite abut 120 guests who all give gifts of about $186 (the average price), then you would get over $22,000 for your down payment! That would cover a 105 down payment on a $220,000 starter home. Of course this is just an example, and real world result certainly vary.  But it shows how much this can help a new couple on their way to buying their first home.
Services are already in place to make this all happen, such as a company called HomeFundMe. Friends and family can easily and safely contribute to the fund.  Plus the ones contributing can decide if their gift is  ‘conditional’ or ‘non-conditional’ on the beneficiary buying a home.
According to a recent Wall Street Journal article report, “about 400 borrowers have used HomeFundMe to help buy homes since the program launched in October and on average, they raise about $2,500.” The article goes on to show that these funds are used by the borrower along with their own savings to help them reach the down payment.
Add to this the fact that many first time buyers can take advantage of programs from Fannie Mae and Freddie Mac that lets them put down as little as 3%.  Also, FHA programs require as little as 3.5%, and VA Loans are often approved with 0% down!
Gone are the days when you had to come up with a whopping 20% down. And with this creative solution, now even more first-time buyers can make owning a home a dream come true.

 

Many first time buyers struggle with saving enough for a down payment. But one creative way to save that money is gaining traction - crowd sourcing. It's a great way to let friends and relatives help you buy your first home.


Here's how it works. When a young couple gets married, they will invite the wedding guests to skip the usual gifts and instead contribute to a “Down Payment Fund." Usually a newly wed couple already has the items they need for a new home, as they have their own furniture and home items. Now all they need is the new home.


When you see the math, it makes it even more clear why this is such a great idea. For example, if you have a wedding have 120 guests who all give gifts of about $186 (the average price), then you would have over $22,000 for your down payment! That would cover a 10% down payment on a $220,000 starter home. Not bad! This is just an example, and real world result certainly vary.  But it shows how much this can help a new couple on their way to buying their first home.


Services are already in place to make this all happen, such as a company called HomeFundMe. Friends and family can easily and safely contribute to the fund.  Plus the ones contributing can decide if their gift is  ‘conditional’ or ‘non-conditional’ on the beneficiary buying a home.


According to a recent Wall Street Journal article report, “about 400 borrowers have used HomeFundMe to help buy homes since the program launched in October and on average, they raise about $2,500.” The article goes on to show that these funds are used by the borrower along with their own savings to help them reach the down payment.


Another thing that helps first time home buyers is that they can take advantage of programs from Fannie Mae and Freddie Mac that lets them put down as little as 3%.  Also, FHA programs require as little as 3.5%, and VA Loans are often approved with 0% down!


Gone are the days when you had to come up with a whopping 20% down. And with this creative solution, now even more first-time buyers can make owning a home a dream come true.

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