In our previous article, we discussed Community Home Investment Programs or CHIPs and the available different types. Now, we’re going to talk about the qualities that we look for in a program before we consider it as a CHIP. Do we see all down payment assistance programs and federally funded initiatives as CHIPs? No, there are certain qualities that we are on the lookout for.
What Makes a CHIP a CHIP?
To make things simple, the main thing that we look for in a program to consider as a CHIP is whether it makes the homeownership process easier. It doesn’t matter whether the program is run by local governments or nonprofits, if it is there to assist homebuyers, then we will consider it a CHIP.
The way that these programs make things easier for homebuyers can come in different forms. Down payment and closing cost assistance programs, as the names would suggest, are there to help homebuyers pay for those homebuying costs. These are the most common types of CHIPs that are available since one of the hurdles for many homebuyers is the lack of cash to cover a down payment.
Programs that offer subsidized loan interest rates are less common but are nonetheless helpful. Rehabilitation grants and rehabilitation loans can also be considered as CHIPs. The idea is that it gives those who are seeking to fulfill their dreams of homeownership a boost.
The key element is that it makes things easy for a homebuyer; that is what makes a CHIP a CHIP for us.
Not for Profit
Another key element that we are looking for in a program before we can consider it as a CHIP is whether it is there to gain profit. A CHIP does not aim to make money from homebuyers. While some are loans that would have to be paid back, the aim is not to profit from the process. They must be paid back so that other homebuyers can take advantage of the same offers.
There are other CHIPs that do not need to be paid back at all if certain conditions are met. For example, there are programs that cover down payment and closing costs which do not need any repayment if the homeowner lives in the property bought within a set period.
Investing in the Community
We call these programs CHIPs for a reason. The part about investing in a community is very important for us. When you buy a house, you are actually investing in that community. You are tying your future with the future of that community.
This is especially true for families who buy a house and move into a neighborhood. They are betting that the community they have chosen will have a great future for the sake of their children. We are also looking for programs that facilitate this kind of investment.
Homebuyers Deserve the Boost
You’re probably tired of the comparison between baby boomers and the current generation of homebuyers, about how the parents of millennials were able to buy houses when in their 20s while having a job that didn’t necessarily pay that much, and how that’s almost impossible now. This is why many millennials today are discouraged from even considering buying their own home.
However, what might seem to be conventional wisdom is misleading. Data from Realtor.com proves that millennials do not have worse outcomes when it comes to the housing market when compared with the older generation. The data suggests that baby boomers had a much more difficult time.
The data shows that back in 1980, the rates spiked up to 16%. During the years when boomers reached 30, the share of the median household income that was needed to meet the average mortgage payment was more than 33%. That’s a third of the income of household!
Based on the data, millennials only must set aside a bit more than 22% of their median income for mortgage payments. Does this mean the idea that millennials have a difficult time buying a house isn’t true? No, there are a lot of factors that are playing.
However, what is true is that many individuals are discouraged from pursuing their homebuying dreams because they believe the market is stacked against them. They don’t even bother to check what their options are.
They don’t realize that there are CHIPs out there that can help boost their homebuying efforts. They would rather rent at exorbitant prices because they think that is the more sustainable option. This mindset, however, is causing some other problems.
Over 90% of Americans whom are aged between 18 and 44 aspire to own houses at some point in their lives. To see that hope get dashed by the perception that the market is against them can cause a great deal of grief and stress. With the use of CHIPs, however, more and more people can come closer to their dream of owning a house.
Spreading the Good News about CHIPs
The main reason why Homebuyerwallet.com was founded was that there was a lack of information among homebuyers about CHIPs. Many people were unaware that there are programs out there that are designed to make things easy for them when buying a house.
We have gone through programs from all over the country and carefully selected those that we believe are helpful, compiled, and listed them as CHIPs on our platform. We have also built the website so that users will have an easy time finding the CHIPs that they can qualify for.
With more people becoming aware of the existence of CHIPs, we’re hoping that there will be an increase in the number of people opting to become homeowners.
What’s in a CHIP? A Dream!
So, what is in a CHIP that makes it a CHIP for us?
It’s the quality that makes it helpful to homebuyers. If a program is adding just another burden to someone who wants to buy a house, then that’s not a CHIP. It’s the quality or qualities that allow homeownership dreams to become reality that we’re looking for. That’s what makes a CHIP a CHIP!
.png){kind=logo}
