John, Here Are Your Articles for Wednesday, April 03, 2019
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Attract Staff With Down Payment Assistance

 

There's a good chance many of your employees, especially younger ones, are scrimping and saving to buy a home. Is there anything employers can do to help? Very possibly.

First, a little background. The home ownership rate for third quarter 2018 is 64.4 percent, a slight increase from 63.9 percent in third quarter 2017. While those figures represent adults across different generations, it's been consistently reported that individuals age 37 or younger — also called "millennials" — account for the largest share of homebuyers.

According to a 2018 report by the National Association of Realtors, millennials make up 36 percent of homebuyers, compared to Gen Xers at 26 percent and baby boomers at 18 percent. With millennials carrying enormous student loan obligations and with housing costs escalating, funding the down payment on a home is often a massive burden for this demographic.

Fortunately, there are down payment assistance programs that allow employers to help their employees raise money to buy a home. One popular option is the HomeFundIt Affinity Portal, a crowdfunding platform that enables employers to include down payment assistance in their benefits packages.

The Affinity Portal is designed specifically for employers

Previously called HomeFundMe, HomeFundIt is the only down payment crowdfunding platform that has been approved by mortgage giants Fannie Mae and Freddie Mac. Launched in 2017, the program lets borrowers crowdfund their down payment free of cost. HomeFundIt is run by CMG Financial, a California-based, privately held mortgage bank.

In 2018, HomeFundIt announced the rollout of the Affinity Portal, which allows employers to offer HomeFundIt as a bona fide employee benefit. Basically, employers can contribute directly to their employees' HomeFundIt accounts by matching donations in any amount. To facilitate this perk, employers must share the customized crowdfunding platform with their employees, and HomeFundIt will deliver the resources needed to communicate the benefit.

Per HomeFundIt, loans are eligible for lender matching on every dollar that's crowdfunded, up to a specific maximum. In addition, the Affinity Portal simplifies the prequalification process for homebuyers and offers homebuyer education, fundraising coaching and loan origination.

With employees always on the lookout for benefits that can help them achieve their goals, and with employers always on the hunt for ways to retain the best talent, the Affinity Portal is a viable option for employees and employers alike.

Not sold on the Affinity Portal?

There are other ways to help, including:

  • Mortgage payment assistance.
  • Vendor discounts.
  • Shared equity.
  • Land donation.
  • Employer-constructed housing.
  • Contribution to a community housing fund.
  • Loan guarantees.
  • Home insurance discounts.
  • Interest rate buy-downs.
  • Relocation assistance.
  • Moving expense reimbursement.

It can be expensive and complicated to set up and administer some of these benefits. Consequently, many employers focus on simpler offerings, such as home ownership education, homebuyer counseling or some type of financial assistance. No matter how small the benefit, employees will likely appreciate it.

If you're interested in providing down payment assistance or housing benefits, consider speaking with an employee benefits expert.

 
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Our firm provides the information in this e-newsletter for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation.The information is provided "as is," with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.
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