Are you ready to buy a house, but can’t manage to save enough money for the down payment? Consumers mortgage experts David Pendley and Josh Summerfield are here to talk about some grant programs that could help you get into your next home.

 

 

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0:00:06.6 Lynne Jarman-Johnson (LJJ): Money, I’m Home. Welcome in, I’m Lynne Jarman-Johnson with Consumers Credit Union. Thanks so much for joining us today. From finance to fitness, we have it all. And I’ll tell you what, we have a brand-new program that we have partnered with organizations around the country that are helping find you grant money for your home. Now, what does that mean? We’re talking about grant money for down payments, smaller percent down, that then allows you to actually get some money back. David Pendley and Josh Summerfield are here today, they are our experts here at Consumers Credit Union, in the mortgage industry and also nationally. Thanks, you guys, for joining us today.

0:00:46.1 Josh Summerfield (JS): Glad to be here as always.

0:00:48.2 David Pendley (DP): Good to be here, Lynne.

0:00:48.6 LJJ: Josh, you were talking to me this week about this great partnership that we have that has opened up doors that people just didn’t even know about before. Tell us a little bit about it.

0:00:58.4 JS: Yeah, and grant programs is one of those things that not many people talk about, but it’s a way for us to have you bring less money to the closing table. Maybe you had some trouble saving, or maybe you want to keep some of your money in your savings to buy furniture or things down the road once you get into the house. So, there’s grant programs available and specific loan programs that allow for lower down payments, one of which with our recent partner is 1% down, and then there’s a 2% grant for low- to moderate- income borrowers. There are some parameters that you have to work around, but there’s 2,600 grant programs out there that some have requirements, some don’t have requirements. So now we have access to kind of determine, do you qualify for one of these programs that we can partner you up with to give you some extra money towards your down payment?

0:01:49.9 LJJ: Now, David, this has to be very thrilling. We talked last month about the fact that there’s such a disparity in home buyer-ship right now. This really does help anybody who is facing that, “I just don’t have the down payment.”

0:02:04.7 DP: Yeah, it really does. And also, in conjunction with most or many of these grant programs, they’ve alleviated the PMI, either the requirement or its reduced private mortgage insurance, which is the insurance that insures the lender for the top 20% of the loan or 25% of the loan, so they’ve made other concessions as well, and that’s how serious the Federal government is on home ownership for everybody, for low- to moderate-income buyers right now. They’ve been edged out the last couple years, and this chasm seems to be widening, and so it is a full-frontal attack from both sides of the aisle to try to initiate homeownership in all markets.

0:02:50.6 LJJ: Josh, here’s an interesting quandary, I think, that’s happening across the country, including in Michigan, in West Michigan, and that is that there are individuals who right now are renting or they’re leasing, and those numbers are going up exponentially. And all of a sudden, they’re looking at numbers that, wow, they could get into a house.

0:03:12.6 JS: Yeah, no doubt. If you’re not looking at these as an option, you’re kind of doing yourself a disservice, because you maybe think you can’t get into a house because, “I don’t have the funds for down payment,” and you’re not aware of these programs. So that’s where it’s important to have a conversation with a lender and really see what capabilities you have to get into a house, and if it makes sense for you, because it may not make sense in some situations. But until you’re having those conversations and exploring what’s out there, you’re not really going to know.

0:03:41.2 LJJ: And David, how important is it that those who are listening and are interested in this type of program, whatever financial institution they go to, that at least that conversation is brought up of the different opportunities that there are, versus, “Oh, I don’t know.” I just think it’s so important to ask the questions, and if you’re not comfortable, you need to find a lender that you’re comfortable with.

0:04:08.0 DP: You really do. It’s as we talk about sometimes, it’s about building your team, which is a great realtor, a great lender, maybe a great attorney or a great financial advisor as you’re embarking on this endeavor. But we had a buyer recently who needed to close in two weeks. Well, we pulled their credit and it was a 777, which is a great credit score. But if we could have gotten three more percentage points, we could have even dropped the rate a little bit lower, because it puts them in another category. I wish they would have applied a month ago or two months ago in a pre-approval, versus waiting until they could walk in with a contract and say, “Quick, I need to close in two weeks,” because there’s little nuances we can do to help even improve the financial picture even better.

0:04:51.5 LJJ: Well, and that’s the whole point, isn’t it, Josh? Of saying, “Okay… ” You don’t want to be in a position where you’re making decisions with not enough time to really think about, is it the right decision?

0:05:02.6 JS: And we see it far too often, to be honest. We try to prepare people as best we can, but sometimes, they do walk in and put themself in that position. And we can absolutely handle that, don’t get me wrong there. We will help our member in that situation and walk them through it and get the best that we can out of that, but could we have done better for that member and put them in a little bit better position if we would have done a little bit more planning upfront and gotten a pre-approval 60, 90 days…

0:05:30.1 LJJ: It reminds me, David, of something. A home is bought with heart, [laughter] and sometimes, your heart is just going to just go running and your brain’s a little bit behind.

0:05:40.7 DP: We’ve seen that over and over, like, “This is the only house in the whole world that will ever make us happy, we’re willing to do anything including sell our firstborn to get this house.” That’s why it’s good to have a little mini board of directors that you’ve assembled to keep you rational when the emotions do get carried away, which I have even been part of.

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0:06:03.9 LJJ: I think we all have. Well, I’ll tell you what, we have the programs for you. If you are out there hunting and you’re feeling like you’re not being listened to by your financial institution, we’d love you to come over to Consumers and talk with us. Stop by any office, you can pick up the phone too. We’ve got great mortgage loan officers. Josh and David, thank you so much for being with us.

0:06:24.6 JS: Yeah. Thanks, Lynne.

0:06:25.8 DP: Thanks, Lynne.

0:06:26.3 LJJ: And thank you for listening. We’ll be back next month with some more information for you. And if you have any topics you’d like to share, please send them my way. I’m Lynne Jarman-Johnson with Consumers Credit Union. Thank you, Jake Esselink, for your production skills. Everybody, have a very safe month.

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