Buyers Turn to Crowdfunding to Afford a Home

More aspiring home buyers are increasingly turning to crowdfunding to drum up money for a down payment.

Several new crowdfunding platforms have debuted, such as HomeFundMe and Feather the Nest, to help potential home buyers raise funds to purchase a home or make home repairs. Online registries like HoneyFund include the option of gifting a down payment contribution.

“The number one challenge that we hear from millennials in terms of their ability to buy a home is the down payment,” says Jonathan Lawless, vice president of customer solutions for Fannie Mae. “Crowdsourcing is an interesting new way that a person can generate a down payment, one made possible by technology. … We think there is a great future for it.”

A consumer who is prequalified for a mortgage could create a personal page on a crowdfunding site. They can share their journey toward homeownership and then share the pages with family and friends.

“[Many] people find they can afford [mortgage] payments, but not the down payment to own a home,” Christopher George, CEO of CMG Financial, a mortgage banking firm that launched HomeFundMe, told realtor.com®. HomeFundMe is the first such site to be backed by mortgage financing giants Fannie Mae and Freddie Mac.

READ MORE:  http://realtormag.realtor.org/daily-news/2018/05/14/buyers-turn-crowdfunding-afford-home

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