Daily News Portal

Guaranteed Rate adds special purpose credit program in 6 markets


Guaranteed Rate is the latest lender to bring a special purpose credit program to market, providing up to $8,000 in assistance to underserved potential homebuyers.

Specifically, the Chicago-based lender will provide a minimum of $5,000, along with an additional 1% of the sales price or $3,000, in down payment and closing cost assistance.

The SPCP is currently available for first-time home buyers currently living in specific census tracts of six metropolitan areas — Atlanta, Baltimore, Chicago, Detroit, Memphis and Philadelphia. But the funds can be used for a purchase anywhere in the country.

“The barrier to entry for most renters who want to buy homes is the sizable down payment and initial repair or improvement costs,” said Kasey Marty, Guaranteed Rate’s executive vice president of secondary marketing. “This program helps tear down these barriers and open more doors to the houses, neighborhoods and lifestyles of our customers’ dreams, an investment that will help build a foundation for generations to come.”

Additional features include improved pricing for nontraditional loans, a title insurance credit for certain properties and the removal of area median-income requirements.

This new program is in addition to Guaranteed Rate’s expansion of its Language Access Program last September created to deliver communication to applicants entirely in Spanish.

In general, SPCP programs have gotten additional interest in the lending community following the Department of Housing and Urban Development’s clarification in December 2021 that participation will not cause an inadvertent fair housing violation.

Freddie Mac said it took the first steps towards creating one of these programs last September, aiming to introduce it this year. Meanwhile, Fannie Mae plans to test appraisal reimbursement through a SPCP.

Among the lenders that now offer a SPCP are Legacy Home Loans, Bank of America and Rocket Mortgage. In the wake of its recent legal settlement with the Department of Justice, City National Bank will be launching special-purpose credit programs for commercial loans and residential mortgages that will target underserved populations in Los Angeles as well as New York, Georgia, Nevada and Tennessee.

Wells Fargo said it is expanding its $150 million SPCP to refinance minority homeowners to now include purchase loans as part of the bank’s announcement that it is shutting down the correspondent lending channel..





Read More:Guaranteed Rate adds special purpose credit program in 6 markets