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We’ve all seen crowdfunding campaigns to raise money for a business or a honeymoon; but a new platform from CMG Financial, HomeFundMe, is making it possible for homebuyers to crowdfund their mortgage down payments with donations from family, friends and even perfect strangers.
HomeFundMe is the first online platform of its kind:
- There is no fee to use the program and donors can contribute up to $7,500
- For borrowers earning less than the area’s median income, HomeFundMe will match two dollars for every dollar raised up to $2500 or one percent of the home price; borrowers earning more than the area’s median income will have funds matched up to $1,000
- The program is backed by Freddie Mac and Fannie Mae
“This allows you to tell your story. It allows for folks to be able to buy into the story of what it is you have, your loan story, your home story,” stated Christopher George, CMG Financial CEO and Mortgage Bankers Association Vice Chairman. “Our tagline is, ‘Fund your way home.’ We think homeownership still is very sensible and, done correctly, is a good idea to step forward toward wealth, stability and quality of life.”
With rising home prices showing little signs of stopping, we are seeing the emergence of novel affordable housing techniques. One thing to consider in crowdfunding is that unlike expecting a return on a business investment or lending a hand with an unforeseen medical emergency, helping someone come up with a down payment seems less urgent because homeownership is viewed more as a privilege.
Americans want to own homes and innovation is helping them adapt to the expensive housing market, but will enough people donate to allow the mortgage crowdfunding space to thrive?This new development could prove to be an exciting way for more people to achieve their dream of homeownership.