Guild Mortgage, a company that has been originating and servicing home loans since 1960, has announced the start of its 1% Down Payment Advantage program, a new 1% down and 1% interest rate buydown (for the first year of the loan) to aid low- to moderate-income borrowers in today’s tight market.
For conventional loans, the typical down payment is 3%, this new progarm allows homebuyers to purchase a home with a minimal down payment of 1% with the other 2% being covered by Guild to meet the 3% minimum.
In addition to the low down payment and interest rate buydown the program offers, borrowers will still have the flexibility to refinance with Guild at a later point with an added benefit of no lender fees under the company’s Payment Protection program.
“Guild is committed to providing innovative solutions that meet the current and future needs of homebuyers. No matter what is happening in the housing market, we want to get people into homes and help keep them there,” said Mary Ann McGarry, Guild’s CEO. “With our new 1% Down Payment Advantage program, we are meeting our clients where they are and addressing head on the accessibility challenges so many Americans are facing in today’s housing market.”
The 1% Down Payment Advantage program builds upon Guild’s successful Payment Advantage program—introduced in December 2022—and has helped homebuyers achieve their homeownership goals. The program is available to first-time and repeat homebuyers purchasing single-family homes with income equal to or less than 80% of the area median income.
David Battany, Guild’s EVP of Capital Markets, emphasized the importance of addressing the three key areas that impact homeownership: the cost to get into the home, the monthly cost to stay in the home, and the ability to handle unexpected emergencies in the first five years of owning a new home. The 1% Down Payment Advantage program addresses all three.
“We know that accessibility to homeownership goes beyond just lowering the down payment. It’s about ensuring long-term sustainability by tackling the three critical financial challenges of buying and maintaining a home: upfront costs, monthly expenses, and financial resilience after purchasing a home,” said Battany. “With our 1% Down Payment Advantage program we support homebuyers in all three of these areas. By putting an extra two points of cash into their reserves on day one and offering a 1% one-year interest rate buydown that reduces their monthly mortgage payment, we assist borrowers to more quickly build up their cash reserves which helps sustain them in their new home during their critical first five years of homeownership when most first-time homebuyers typically have low cash savings reserves. This sets the stage for a successful homeownership journey, arming them with the confidence and means to handle life’s unexpected surprises.”
Editor’s note: Guild Mortgage is a member of the American Mortgage Diversity Council, a subsidiary of MReport’s parent company Five Star Global.
