MINNEAPOLIS, Nov. 28, 2017 /PRNewswire/ -- Home Partners of America ("Home Partners") and New Penn Financial are pleased to announce a new pilot, the "Ownership Conversion Pilot," to help qualifying first-time homebuyers, in Minneapolis and throughout the country, succeed in their path to homeownership.
Many first-time homebuyers are unable to purchase a home today because of high down payment requirements, financial circumstances such as student debt, or the need to build credit. Additionally, Minneapolis home prices are rising; during the past 12 months, the value of residential real estate in the area rose 5.44 percent.* In this pilot, residents in Home Partners' Lease Purchase program who are first-time homebuyers and meet Fannie Mae's eligibility requirements may work with New Penn to use any home price appreciation of the home they rent towards their down payment at purchase.
How it Works
Under Home Partners' Lease Purchase program, approved applicants work with a licensed real estate agent of their choosing to select the right home for them. Applicants can choose from a wide portfolio of homes available for sale across the country that meet Home Partners' criteria. Home Partners purchases the selected home, leases the home to the resident with pre-determined rents and provides a right-to-purchase at pre-set prices for a defined future period (three to five years). While the resident's only financial commitment is to lease the house for one year, he or she may renew the lease for additional one-year terms (generally three to five years).
Current and new residents in Home Partners' Lease Purchase program are eligible to participate in the Ownership Conversion Pilot and may have the opportunity to take advantage of any appreciation equity once they have demonstrated 24 months of consecutive on-time payments, completed home ownership education or counseling, and meet other underwriting and eligibility criteria. Since this is a test and learn opportunity, the pilot will be available until late 2019.
Residents who participate in this pilot could benefit from features and requirements that include:
- If the home goes up in value during the rental period, the resident could receive the benefit of appreciation when it comes time to purchase the home;
- Residents may qualify for a mortgage using as little as their security deposit as a down payment or towards closing costs;
- The rental period gives residents time to prepare for homeownership, repay other debts, such as student loans, or save for closing costs; and
- Residents are positioned for long-term success by being required to complete homeownership education or counseling.
Home Partners' existing residents may be eligible for the pilot immediately after launch if they have already met the 24 month timely payment and counseling/education requirements. Additionally, new residents who begin Home Partners' Lease Purchase program during the two-year period after the pilot launch date may be eligible for the pilot as well.
Currently, New Penn Financial serves as the exclusive lender for the pilot. The Ownership Conversion Pilot is a key element in New Penn's affordable lending platform, aimed at providing access to credit to credit-worthy borrowers.
"Given the sizeable demographic shift of millennials moving from renters to homeowners that we expect will play out over the next decade or more, Home Partners of America is in the right space at the right time," said John Peyton, President and Chief Executive Officer of the Realogy Franchise Group. "Through Home Partners' program, our network of affiliated agents and brokers are empowered by a trusted relationship through which they can offer their rental clients a new path to homeownership."
"Home Partners' residents have worked hard to establish and maintain good credit," said Robert O'Han, Senior Vice President, Consumer Direct Channel at New Penn Financial. "New Penn is proud to be the lender that is financing the dream of homeownership."
"Our goal is to provide our clients a transparent and flexible path to homeownership," said Bill Young, Co‐Founder and Chief Executive Officer of Home Partners. "Many people want the benefits of living in a single‐family home but are not yet ready to buy for a variety of reasons. We are committed to helping as many of our residents succeed when the time is right. The Ownership Conversion Pilot provides potential first time homebuyers with the flexibility to prepare for homeownership while renting a home and the potential to reduce their down payment requirements."
To learn more about Home Partners of America or to apply, visit www.homepartners.com.
* According to the September 2017 S&P CoreLogic Case-Shiller 20-City Composite Home Price NSA Index.
About Home Partners of America
Home Partners is committed to making homeownership a reality for more people. The Lease Purchase program provides a clear path to homeownership. The process is easy, transparent and built on a foundation of choice and flexibility. Home Partners is helping more people get into homes, in neighborhoods they love, with the opportunity to build a more secure financial future.
Home Partners' operates in over 50 markets and has already helped more than 20,000 people move into homes, building strong communities across the country. Hundreds of households have successfully converted into homeownership, using the existing Lease Purchase Program and Home Partners is pleased to offer this pilot to further position first-time homebuyers for long-term financial success.
Formerly known as Hyperion Homes, Home Partners launched in mid‐2012 as a new solution to the tight mortgage market. Home Partners has relationships with several real estate companies, including Realogy Holdings Corp.'s franchise brands CENTURY 21®, Coldwell Banker®, ERA® and Better Homes and Gardens® Real Estate, as well as NRT LLC, the largest residential real estate brokerage firm in the United States, also a subsidiary of Realogy.
About New Penn Financial
New Penn Financial has become a leading nationwide lender by bringing expertise, competitive rates, and exceptional customer service under one roof. Founded in 2008, and licensed in 48 states, the company has grown rapidly under the guidance of a management team with years of experience in the mortgage industry.
New Penn offers residential mortgage loans through three business divisions: Direct-to-Consumer (Call Center), Retail (Distributed and Joint Venture), and Third Party Origination (TPO). Headquartered in Plymouth Meeting, PA, the lender has more than 2,000 employees nationwide and operates 160 offices across the country. New Penn is a Shellpoint Partners company. More information is available at: http://www.newpennfinancial.com.
SOURCE Home Partners of America