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Citi to Expand Program Making Homeownership More Attainable – The Motley Fool

Image source: Getty Images

That’s good news for struggling buyers.

…….

Image source: Getty Images

That’s good news for struggling buyers.


Key points

  • Homeownership can lend to financial stability, but it’s not an option for many low- and moderate-income buyers.
  • One lender is expanding a program that seeks to eliminate barriers to homeownership.
  • Citi’s HomeRun program is expanding to more cities.

Buying a home can be challenging for low- and moderate-income mortgage applicants for a number of reasons. First, those who don’t earn a lot of money often struggle to come up with funds for a down payment. Also, mortgage applicants with less-than-stellar credit might struggle to get approved for a home loan.

But one lender is looking to make homeownership more attainable for those who may have struggled to purchase property in the past. And that’s a very positive thing, especially at a time when mortgage rates have gotten higher and home prices remain inflated on a national level.

A much-needed expansion

Citi already has a program called HomeRun in place that seeks to help disadvantaged buyers purchase a home. Now, it’s expanding that program in the hopes of reaching more people. The goal in doing so, Citi says, is to promote racial equity and financial inclusion.

Citi’s HomeRun program is designed to target low- and moderate-earners based on census data. Right now, it applies to borrowers earning less than 80% of the family median income in their area. But that percentage is increasing to 120% to open the program up to more applicants.

The program is also expanding geographically. Right now, HomeRun is available in cities that include Los Angeles, San Francisco, New York, Miami, Washington, D.C., and Chicago. But Citi plans to make it available in new markets, including Austin, Dallas, Atlanta, Denver, Houston, Philadelphia and Cambridge, Massachusetts. And, Citi plans to specifically target minority borrowers within those markets.

Removing barriers to homeownership

One major benefit of the HomeRun program is its low down payment requirement. Borrowers can get approved with as little as 3% down on a home.

Granted, FHA loans offer comparable leeway on the down payment front, but they also charge upfront and ongoing mortgage insurance that can be a burden for borrowers. HomeRun doesn’t have a mortgage insurance requirement. And, it comes with a credit designed to offset or cover closing costs.

Just as importantly, Citi wants …….

Source: https://www.fool.com/the-ascent/mortgages/articles/citi-to-expand-program-making-homeownership-more-attainable/

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