https://downpaymenttx.org
Speaker 1 (00:03):
All right, we're recording.
Speaker 2 (00:06):
Okay. Right. So if you could tell us Hello, hello. If you could just tell everyone, um, one, how did you, what was you looking for? What was you searching for? And, um, just tell us your story, like you explained to me at closing. Um, what, probably what you were told by other people that maybe the programs didn't exist, but if you can share with everyone, um, what you were searching for in the process of purchasing a home.
Speaker 3 (00:35):
Sure. Sure. So I started the process, um, around Q1 of this year, so 2022. And I was really just looking to purchase my first home within the Houston, Texas area. And, you know, I had heard about programs, um, helping individuals or families get into homes, but I often heard that there were certain specifications that you'd need to fall under in order to purchase a home, uh, or get any sort of a down payment assistance or reduction in price or something of that nature. So I said, well, I'll go ahead and just try to look anyways. And I knew that I was specifically looking for a home that I could live in and eventually rent out, um, for, you know, real estate portfolio purposes. So from there, I did a quick Google search and I searched for, uh, Houston, uh, real estate, uh, assistance programs. And so from there, a couple things popped up on, at the top of my search, and I scrolled, I scrolled a little bit further down, and, uh, I saw a zero, uh, zero down assistance program.
Speaker 3 (01:49):
I clicked on the page and, uh, it was pretty straight to the point, explained a little bit about the program and, uh, you know, just general information. But when I clicked on that page, I saw, uh, real estate name, and, which was, was Fran, uh, who helped me purchase the home, but I didn't see any sort of, uh, ramifications qualifications. So I said, well, uh, you know, that's good too good to be true. So I followed up with a call to Franz, and, uh, from there he answered and he was able to, uh, answer all of my questions immediately and told me that there were no specific qualifications. I just needed to be able to show proof of income and credit score, um, really all the general things that you typically would need to purchase home. Uh, so from there, I kind of just started working with him. Um, we talked a couple of times before I signed on with him, uh, just so I could get more information and feel comfortable with the process. Uh, but that was really the, the intro to the journey in purchasing the home.
Speaker 2 (02:51):
Did you, uh, actually watch the two minute case study video?
Speaker 3 (02:57):
No, I didn't.
Speaker 2 (02:59):
Right. And so that, that's okay. Um, I'm just asking questions. And then, so, um, did you talk to anyone prior, maybe, uh, any other lenders or anybody in the industry that may have said that you didn't qualify cause of the income that you, that you make?
Speaker 3 (03:17):
Uh, when I spoke to other realtors in the past, uh, in, in the Texas, just the general state of Texas, they did let me know that there were down payment assistance programs. But I kind of had heard in the past about different programs and even programs that helped real estate investors purchase homes such as FHA or the VA loan and all of those other kind of loans. I knew that there were certain, uh, ramifications. Um, so I didn't necessarily, look, I didn't necessarily, uh, think that I would fall under any of those categories to qualify me. Um, but, uh, I'd say no prior realtor before talking to Franz, uh, ever explained to me about the Zero Down program at all. So, uh, yeah.
Speaker 2 (04:08):
Okay. Um, this is great information. Um, a lot of consumers, when we find out, um, Richard that you've met, um, we probably talked to about seven, 8,000 inquiries a year. Right. And next year we're working on doubling that. And so we hear the complaints, uh, of what people have been told, um, about the process. And we decided years ago that we would just focus on the different banks that offer the program, and we would tailor it to your, like your situation based off credit score, based off income, what your goals are, what you're trying to do. We've figured out over the, because we get so many calls and so many each day, we've figured out years ago that would be the best approach, uh, for the client, finding out what their needs are and matching them up with a, that offers a product for that.
Speaker 2 (05:03):
So, um, one of the biggest things is you don't thank God you found us, right? Right. Because we get calls every day that, um, people were told, um, that they don't, they don't qualify income of income. And so they up putting 5%, 10%, and a lot of 'em, but in 20% down, um, uh, to avoid, they're only doing that to avoid a PMI or mortgage insurer. Um, what, um, during the process, we don't mention names of banks on the, on the, uh, we just don't do that. Um, cause when they're not, they don't pay for anything for us <laugh>. So we're not giving them free advertisement. That's the reason why we don't do that. Um, what, you come from a fa a family of, uh, real estate and you're from what state? Again?
Speaker 3 (06:01):
I'm from Illinois, uh, specifically the Chicago Land area. And, uh, family has been in the real estate industry going on three generations now. Um, so I did have a little bit of, uh, intro into this, you know, real estate world. Um, and I knew about programs out there, but, um, even still, uh, with, you know, years of, uh, knowledge from others and being around the industry had never heard of, of this program, typically what you hear of would be, uh, like I mentioned FHA or some sort of state specific program, but you still had to put down a certain amount of money and you'd still be subject to PMI and things of that nature. So, um, but yeah, never had heard of Zero Down program.
Speaker 2 (06:44):
Okay. And so with that, do you mind telling, uh, uh, the viewers that, what was your total cost out of pocket buying your house? Um, utilizing the programs?
Speaker 3 (06:59):
So my total cost was, uh, zero, uh, winter closing, did not need to bring a check. Uh, had the ability to actually, I put money down, uh, for escrow, but I actually will be receiving that, that refund back. Um, so everything is, um, wrapped up on in the loan and did not have to come to the closing with anything. Uh, just, just brought myself.
Speaker 2 (07:24):
Right. So you end up getting your earnest money back.
Speaker 3 (07:27):
Yes. Sorry. Earnest money. Yes.
Speaker 2 (07:29):
Get your earnest money back. No, that's fine. It's, it's fine. Uh, and your earnest money, so only cost out of pocket. Did you get an inspection done on the house?
Speaker 3 (07:38):
Yes, I did get an inspection on the house. Yeah. So that was out pocket cost? Yeah.
Speaker 2 (07:42):
Okay.
Speaker 1 (07:43):
What was the, uh, what was the cost of the inspection?
Speaker 3 (07:45):
Inspection was three 50. Okay.
Speaker 1 (07:50):
Not bad.
Speaker 3 (07:52):
Yeah. This is a good price. <laugh>.
Speaker 2 (07:55):
So one of our goals, I don't know if you know this, is that if we could help a family buy a house less than a, would cost you to rent a house. Cause renting a house, usually it's the first month, uh, rent and a deposit. So in your case, it probably would've been somewhere around, I don't know, $5,000. Right. So if we help somebody can move in less, it would've cost them to rent a house. It's like, why not buy a house versus renting a house? That concept, most people, it's, it's hard for them to, and I don't know if it's hard for you now, when you walk into your house every day, knowing that you, uh, you own this house for $350, is, how does that feel to you?
Speaker 3 (08:40):
Yeah, it's definitely something that, prior to this year, I have, I had never thought of. I actually had a down payment, uh, savings fund that I was saving towards, uh, my first, uh, property. Um, so it's, it's definitely been a help. And then also with, um, saving so much money, um, or only putting down three 50 for the inspection, um, that gives me more capital to save and put towards taxes on the home in the future, or have a, just a general savings fund towards the house in case of any incidentals and things like that. Whereas if I had to put down three to 20% or more, um, I would be still, you know, trying to recoup those costs.
Speaker 2 (09:24):
Okay. And then are you, um, would you like to share with the viewers, uh, what, uh, industry you're in and things like that?
Speaker 3 (09:34):
Yes. So, uh, I work in the tech industry. Uh, been in the industry about three or so going on, uh, four years. And, uh, so that's also been a great avenue in, uh, learning more about, um, real estate and being able to put, uh, the money that I do make back into, uh, my own, uh, kind of safety net, if you will, purchasing homes and, and, uh, exploring different avenues of real estate.
Speaker 2 (10:03):
Right. And then, I don't know if, um, we discussed or friends discussed with you that, um, you could always rinse and repeat what we call, um, you could do this process for the rest of your life. Like, this is not just a one time thing. Um, this is a strategy that we use that you can get a second house doing.
Speaker 3 (10:23):
Right,
Speaker 2 (10:24):
Exactly. Do a third house, um, doing it. Um, but there's, there's other strategies of doing that without using your funds. You can keep your money, but like you said, for reserves or for emergency, or you can use those funds to, to make money with that money. Right. And so, I don't wanna put you in the spot. Um, if you, okay. If you wanna tell everybody, um, your age, um, if you like buying your first house, and, um, if you, if you're comfortable with that, not putting you in the spot.
Speaker 3 (10:58):
Sure. Yeah. Uh, I'm, I actually will be 25 in, in a week. So I was 24 when I went to closing. Um, so yeah. Um, was able to do this in a lot shorter time than I would've thought originally. So yeah, 24 exactly at the time of closing <laugh>.
Speaker 2 (11:15):
That's awesome. Well, congratulations at 24. Congratulations.
Speaker 3 (11:19):
Thank
Speaker 2 (11:20):
You. Uh, purchasing your first house, and I'm sure by, by the time other people see this, right, uh, or find out about this, you'll probably be on your second or probably your third house, um, probably before you even hit 30. And you'd be surprised that a lot of people are out there, have no idea that's, that they're ready, just like you. Right. Thinking they'd have to save, uh, a lot of money. But what did, how much money did you think you had to save to purchase of house? That would be the next question.
Speaker 3 (11:52):
That's a good question. Um, I think my goal was about 30 or 40 k just in savings, um, towards the down payment plus, uh, any, you know, extra funds that, you know, if incidental comes up.
Speaker 2 (12:07):
Wow. So 30 or 40,000. And you were thinking, did you think, even though, did you think that was enough? Or do you think you needed more?
Speaker 3 (12:18):
I knew I was gonna need, I, I thought at the time that I would definitely need more, but that was my goal in saving. Yeah. So that it probably would've taken me, you know, a few extra years to do that.
Speaker 2 (12:30):
So were you looking to put 10% down on what goal was you trying to reach? Was you trying to do the 20% or was you trying to do 10%? What was your goal?
Speaker 3 (12:42):
So when I fir originally started, my goal was to purchase a multifamily. Um, so that I, that's why the down payment would be so high. It would still be that 3%, but I knew, um, depending on where I, what city and state I purchased in, which I really just wanted to get a property. It didn't have to be, it didn't have to be a multifamily, that was my goal. Um, and then the city and location in the state didn't need to be any specific place. It was just when I was ready, I was going to have the funds to, uh, make that down payment. So I was looking to use the FHA loan to start, and so that's why the 3% came in. Plus having, uh, 36 months worth of mortgage payments save saved up as well. So that's, that would be wrapped in that 30 to 40 K as well.
Speaker 3 (13:28):
Um, but then when I learned about the zero down program, I said, okay, this is going to be, you know, the realtor explained it needed to be a single family home. Uh, but I said, this is still a great opportunity because like you said, three 50 for an inspection, going to closing with nothing in hand and getting a single family home that you could still eventually rent out. And especially when I was searching for the area, um, you know, I was looking for a, a, you know, a specific set of criteria to purchase in. And to be able to get a new build home on top of that, um, was kind of just the icing on the cake. So I said, I'll take this avenue instead, you know, less out of pocket with larger return. It's no brainer.
Speaker 2 (14:12):
Awesome. Awesome. Any questions? Uh, rich,
Speaker 1 (14:17):
I was gonna, I just wanted to say I applaud you, uh, as a young person for, you know, doing the, the research and not listening to, uh, to people that, uh, you know, would tell you that, uh, that you didn't qualify. So, because I, I hear that stuff all the time. I talk to lenders, I talk to realtors, and, um, you know, I, I, I was telling Jerome, um, I was on a call with a realtor client last week. She's got one lender that she works with. And so if a client fits in to the program that the lender that she, or the, the single lender that she works with, then she can help get into a house. But, uh, but that's one of the things that, that I see kind of from the marketing side. Um, a lot of realtors, they pick, they pick one lender, they work with one lender, and, uh, and if you come to that, uh, that whether it's a broker or real estate agent and, and you fit the program that they have, then you're gonna be able, you know, you, you'll be able to close on a house.
Speaker 1 (15:27):
But, uh, um, man, there, there are so many options and, uh, it's been, it's been a, a, a fun journey, you know, to do this with Jerome and, uh, and see how he's able to kind of craft and put different solutions together for, uh, for home buyers. But, uh, amazing to hear that you went to your, your closing at 24. And, uh, and, uh, and I, I second, I've got a daughter that's, uh, a year older than you are, uh, just recently got married and, uh, her and my son-in-law, they were, they're looking to do, uh, the, uh, the multi-family route. So, uh, so I'm gonna share this, I'm gonna share this with my daughter, um, later tonight. But, uh, I agree. I, I think, but probably before you are, you're 30, you're gonna have a couple more properties in your portfolio. So congratulations. Thank you. Yeah, thank you.
Speaker 2 (16:28):
Thank you so much for your time.
https://youtu.be/hemEhSXVzCQ
