NEW YORK, April 13, 2016 /PRNewswire/ -- ValueInsured and Amalgamated Bank today made available a unique new financial product that protects homebuyers' down payments from falling market values.
+Plus by ValueInsured down payment protection is available for the first time on all eligible Amalgamated Bank mortgages. Exclusively, it is also now available at no cost in the bank's First-Time Homebuyer +Plus program, covering down payments of up to 5 percent of the home's purchase cost. Amalgamated Bank is the first bank to make Down Payment Protection available to its homebuyers.
"The idea behind embedding down payment protection in First-Time Homebuyer +Plus is simply to empower our customers to achieve the American Dream of homeownership," said Keith Mestrich, president and CEO of Amalgamated Bank. "Working people shouldn't have to worry about losing the financial control and flexibility that comes with renting when they make the decision to buy. If they need to sell their home, they may be able to do that even if their local housing values are lower than when they purchased. That's why we're working with ValueInsured, an innovative company that shares our commitment to building trust and opportunity for the people we serve."
Developed for modern homebuyers who have experienced housing differently from previous generations, down payment protection provides a long-awaited sense of security.
"The gyrations of the housing market have made homebuyers acutely aware of the rewards and the risks of homeownership," said James A. Wilcox, professor of economics and finance at Berkeley-Haas. "The general concept of down payment protection helps safeguard homebuyers' hard-earned savings, assuring them that they can get at least a portion of their down payment back when they want to move. This will give homebuyers peace of mind, flexibility, and control."
Fairness Delivered It will also put homebuyers on equal footing. For decades, lenders have protected themselves from risk through the private mortgage insurance that homebuyers have been obligated to pay. The homebuyer, however, has been without similar protection from loss, which can occur when market value changes.
Also for decades, economists have called for new ways to help homeowners protect their down payment. Hedging home value has been called "the greatest idea never sold," and today it is being delivered.
"At last, the homebuyer is protected," said Joe Melendez, CEO of ValueInsured, whose company created the new down payment protection product. "It's fitting that Amalgamated Bank, which has long stood for innovation and customer empowerment, is the first bank to offer this important new protection directly to homebuyers. It helps keep home buying fair, safe and transparent."
The American Dream Down payment protection frees consumers to act on their bedrock values. Owning a home is an important part of the American Dream for more than four in five millennials (83 percent), according to the new ValueInsured Modern Homebuyer Survey.1 In fact, homeownership was the number one personal definition of the American Dream for millennials, ahead of financial security, success at my job and raising a family of my own.
More than three in four Americans (77 percent) believe owning a home is more beneficial than renting.
More than three-quarters of millennials (76 percent) believe buying a home is one of the best financial investments they can make.
Seventy percent of homeowners would upgrade to a new home sooner if they had more confidence in the housing market.
That rate is 90 percent among millennials, who are often "locked" by housing market worries into starter homes as their families expand.
Amalgamated Bank – with offices in New York City, Washington, D.C., and Pasadena, Calif. – is the first of many financial institutions that will make Down Payment Protection available through ValueInsured nationwide.
About Amalgamated Bank For nearly a century, Amalgamated Bank has been a financial institution with a purpose: affordable and accessible banking for all. Offering customers the products and services of a major financial institution, Amalgamated is committed to the values on which it was founded. Amalgamated Bank proudly advocates for workers' rights and promotes the highest standards of environmental, social and corporate governance practices, which is why the bank is the first choice of progressive organizations and people – from presidential campaigns and labor unions to individuals who want a bank that believes everyone should be able to participate fully in our economy. Amalgamated Bank serves their communities with the core principle that the real currency of banking isn't dollars – it's trust. www.amalgamatedbank.com. Amalgamated Bank NMLS ID#898791. Member FDIC. Equal Opportunity Lender.
The Down Payment Protection product is insurance: not a deposit – not FDIC-insured – not insured by any federal government agency - not guaranteed by the bank. Approval of mortgage loans will not be conditioned upon obtaining Down Payment Protection.
About ValueInsured PVI Agency, LLC dba ValueInsured, is the only provider of down payment protection for modern homebuyers, giving them greater control, confidence and flexibility in a volatile real estate market – all for the cost of a lunch per month. Led by a team of professionals experienced in every part of the home buying process, ValueInsured's +PlusSM down payment protection is easy, affordable and backed by one of the world's largest re-insurance companies, with over $8 billion in capital www.valueinsured.com.
1ValueInsured Modern Homebuyer Survey was conducted online by Equation Research on behalf of ValueInsured in March 2016 among a nationally representative sample of 1,157 American adults ages 18 and older.