Down Payment Assistance Program

Down Payment Assistance Program

This is a program designed to assist potential home buyers to put a substantial down payment on their home purchase. This was originally intended for the use of home buyers but can be utilized for any major purchase like home, auto, travel or higher ticket consumer electronic products.

These are among the more common major purchases. These items can be easily financed to customers with excellent A or B credit scores. It can become more of a challenge for customers with C or D credit scores. This program is an excellent resource for credit challenged customers.

How this program works is quite simple. We use a form of financing we call Referral Financing. What is that? You simply refer other individuals who want down payment assistance with their home purchase or any other major purchase. That’s it.

This type of financing is a form of Creative Financing. Creative financing is well known particularly in the real estate investment industry. It could be defined as using non-traditional or creative methods to fund real estate investments. Financing techniques of this type can also be applied to other major purchases as well.

Let’s explain the process in our particular setting a little further. We are affiliates for an outside vendor that focuses on raising capital to fund businesses or major purchases. They raise capital by selling web space on their servers. They pay us a commission for each customer we refer. When you refer customers you also receive the same commission we get.

Each participant pays a small down payment of at least $200 towards their entire down payment amount or product purchase. This amount goes through the vendor’s affiliate payment processor. We receive our commission payment in about 24 to 48 hours. Your DPA customer referrals will repeat the same process you just went through. You then receive your commission payment the same way we did.

Cash strapped customers can use Credit Builder Financing with four $50 dollar payments in a 60 day time period to get to the $200 minimum. You will receive a $150 commission for each customer you refer. This amount can go towards your down payment if that’s what you choose. The more people you refer the larger your down payment will be.

We only work with higher ticket products of $500 or more. These types of purchases can usually be financed with monthly payments and may require down payments or deposits. We help provide the system to assist you with down payments or even the monthly payments if you continue to refer more customers. The number of customers you refer can be unlimited.

We don’t directly work with your FICO score as this may take anywhere from 30 to 90 days to see the effects on your score. That is not a problem and it is recommended that you raise and monitor your score. Our focus is on helping to provide higher down payments for these larger purchases. We can also assist with actually making the monthly payments if you choose to continue to refer customers each month.

Let’s briefly consider a real estate example. You are interested in becoming a home owner. You find a house for $150,000 (or 150K for short). The down payment is 5% but only with approved credit. You can put 10 or 15% down with B credit and tons of paperwork for the banks. Ten percent would be $15K so twenty percent would be $30K down with poor credit and a higher interest rate.
We mentioned a $200 minimum but that is good for purchases of $3000 or less. For purchases of 10K, 20K, 100K or more we suggest Phase II which has a $1200 minimum. You then receive a $900 commission for Phase II customers. You cannot skip Phase I so a good way to use this would be to use a portion of the proceeds from Phase I to upgrade into Phase II.

Let’s return to our real estate example. Ten Phase I customer referrals would be $1500. Ten Phase II customer referrals would be $9K. Repeating that three more times would be 4 X $9K or $36K. This would be more than enough for a 20% down payment on a $150K home even with horrible credit.

If credit score and interest rates are still an issue in spite of a 20% down payment then I would next focus on a payment plan to assure lenders and sellers that you will not default on this purchase. Timely and consistent monthly payments are the only sure-fire way to raise your credit score. You would need a six month to 2 year clean payment record, personal credit score monitoring and good communication with all of your lenders and creditors.

Why not refer more customers or upgrade existing customers? In our example we now have a $120K balance not including interest. I would then include a mortgage reduction plan to eliminate a major chunk of interest payments. This would reduce 30 year plans to 10 or 15 year mortgages.

For example $800 a month is average for a $120K mortgage. Let’s do the math. $800 X 12 = $9600 per year. $9600 X 15 = $144K which is $24K in interest payments alone. This doesn’t include taxes and other maintenance costs. Let’s restructure that with our DPA customer referrals.

Paying $1k per month for 12 months using a mortgage reduction payment plan for this same mortgage would be $12K per year instead of $9600. Fourteen DPA referral customers would be $900 X 14 or $12,600.00. Do this twice and here is what you will have: $30K down payment, $25,200 from 28 more referrals to make 24 months or 2 years of monthly payments upfront. This now totals $50K paid in advance for a house costing $150K. You have paid out thirty percent of the total purchase price in a few weeks or maybe a few months.

This scenario would also work on rent to own financing or lease option financing. Are there banks, lenders or sellers who would balk at these types of payments in a three to six month period? I am sure there are. But look who is in control? There are hundreds of sellers and plenty of lenders who would be willing to work with receiving 30% of the purchase price of a house in less than 6 months.

Could you refer 14 DPA Phase II customers per month for 6 months? Are there 14 new or potential home buyers out there each month who could use Down Payment Assistance?

Do you qualify for this program? Yes. Anyone over 18 can qualify in the US or internationally. This is not a grant or loan. This is customer referral based marketing. You build up your down payment amount or capital using this form of creative financing. If you continue to refer people month after month you can even make your monthly payments.

If your credit score is low or you have mild or even severe credit problems, we suggest raising your score but we primarily focus on providing large down payments and making as many monthly payments upfront as possible. This is crucial for home ownership but it’s also recommended for other financed purchases like automobiles, travel or higher ticket electronic products.