Our Gift/Grant Programs

These Gift/Grant Programs are innovative programs that promote home ownership to low to moderate-income homebuyers with a down payment gift or grant to be used towards the purchase of a home. This is not a loan and the buy never has to pay it back.

Here is how these programs work. The first step is to qualify for a mortgage loan with one of our certified mortgage specialists who are experts in this type of program. As the recipient of a gift or grant, the perspective homeowner may receive up to 10% of the appraised value of the home, which is to be used for a down payment. Additionally, buyers may qualify for a better loan with a much more competitive rate then attempting to receive 100% financing (a no money down loan). Buyers will also build wealth by owning up to 10% of their new home.

Once you're qualified for a mortgage loan, we'll connect you to one of our "Certified" Down Payment Guy Realtors in our network to help you find your dream home. If you have a Realtor that you're already working with, that's ok too. The only requirement is that the seller must be willing to enroll their property in either our Gift or Grant Program.

When you and your Realtor are negotiating the price and terms, we'll help you determine the gift amount required for the down payment and complete the necessary paperwork for the gift which takes just minutes.

There is no fee to apply. When everything is completed, the gift funds will be sent to the title company 24 hours prior to closing. It's that easy.

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Owners Alliance Membership / The Instant Income Program

for both commercial and residential properties

Our Instant Income Program is available to homebuyers in all fifty states and Puerto Rico and provides homebuyers additional funds needed to purchase a property. Here is how it works. The buyer signs up to become a dealer for Global Direct Sales (at no cost). As a dealer, a homebuyer can earn a commission for selling a membership in the Owners Alliance (www.ownersalliance.org) to the seller.

Membership in the Owners Alliance grants the member unlimited access to an expansive array of benefits and products ranging from home warranties and home services to financial products. In addition, the alliance gives homeowners a voice in Washington, DC helping to protect you from proposed anti-homeownership legislation such as the elimination of the home interest deduction and recent eminent domain legislation. Membership in the Owners Alliance conveys with the property and lasts for up to ten years depending on the membership plan selected.

We are often asked, is this only for homebuyers? Do you have to be a homebuyer to sign up as a Dealer? The answer to both questions is an emphatic, "No!"

There are no restrictions on homebuyers using earned funds to establish their down payment, pay off high-interest obligations like credit card and car loans, pay closing costs, keep a reserve fund, buy down interest rates, or provide funds for home remodeling and repair. In fact you can even use these funds to buy that second home or invest in real estate.

Dealers can also enroll properties that they purchase using ANY kind of mortgage loan program including conventional loans, government loan programs, sub-prime, non-conforming and portfolio product.

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Seller Carrybacks

for both commercial and residential properties

An agreement where the Seller agrees to provide a portion of the financing. Example: Seller agrees to "carry back" 20% of the purchase price in a second mortgage and the buyer obtains an 80% first mortgage.

Seller carryback financing is basically when a seller acts as the bank or lender and carries a second lien on the subject property, which the buyer pays down each month. Not only is it offered as a means to getting the home sold, but often it’s necessary to get the deal done if conventional banks and lenders won’t offer the total amount of financing needed.
By offering seller carryback financing more buyers will be able to qualify to buy your home. It also makes your home more attractive to buyers, and can boost the sales price of your home as well. In addition to that, you’ll be earning interest each month as opposed to a straight cash sale.

The idea behind it is that if you believe in the value of your home and feel the buyer will make the payments without fail, it can be a good investment and a means to facilitate the sale of your home. In tough times, it may make of break the sale of your home as sellers shop around for the best terms, especially when conventional lenders offer less than 100% financing.

The interest rate on a seller carryback is determined by the buyer and seller, and takes into account the amount of down payment and the credit profile of the buyer. Obviously a buyer with poor credit will be subject to a much higher credit score than a borrower with a solid credit history.

The interest rate is usually in the range of 8-15% on a seller carryback, and the terms can vary just like a typical lender-based loan, ranging from a adjustable-rate to a fixed product. It is almost always higher than a market-based interest rate because it is assumed that a seller carryback is only being offered because no other bank or lender will offer the same financing terms.

The structure of a seller carryback can vary based on what is negotiated between buyer and seller. Typically, a buyer will get an 80% first mortgage with a large bank or lender, put 10% down and carryback the remaining 10% with the seller. Sometimes the seller carryback will only be 5% or potentially up to 20% of the asking price.

Do keep in mind that many lenders don’t allow seller carryback financing, so it’s advisable to discuss your intentions with the broker or loan officer handling your deal.

If you are a seller thinking about offering carryback financing, do note that in the event of a foreclosure, you are the last party to be paid. The first mortgage always gets paid off first, and if little or no money remains after that, you may end up with a big loss.

Ask the buyer to give you permission to show you their loan approval and their so you can make an informed decision before you put it in writing. And always create a formal document that details the interest rate, loan amount, terms, and have the paperwork notarized and handled by an escrow or title company.

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Rent or Lease to Own

Lease Purchasing is truly a Win/Win Strategy in the field of creative real estate. The reason is because it is not adversarial. There are plenty of advantages and profits for everyone. Consider how many transactions you can profitably produce when price is not an issue. Compare the following lists to any other methods in real estate and you will discover, just as I did, that there is no substitute for the niche called Lease Purchasing.

Seller/Landlord Advantages - The Seller/Landlord is essentially the owner. Imagine being able to make offers on properties listed in the rental and for sale section of your newspaper. Further, once you understand the many strategies of Lease Purchasing you can do deals with the motivated seller, AKA: Henny Youngman deals "Take my home, PLEASE!" the unmotivated seller, "I want full price and I won’t take a cent less" and everyone in between. You will literally make the most profitable, hands off and fun deals of your real estate investor career. All you need is the specialized knowledge of the strategies, the correct contracts and of course an understanding of the advantages.

1. Less Haggling Over Top Sales Price
2. Larger Available Market Of Buyers To Choose From At All Times
3. Better Quality Tenants (Nothing is better than a motivated Tenant/Buyer with a large cash commitment).
4. Higher Rent Than Usual For Market
5. Non-Refundable Up-Front Option Consideration
6. Over market rents (Just give excellent value).
7. Maintenance Can Be Delegated (Yea! No more squirrels nesting in the heating vent calls).
8. No Management Headaches (The rent is paid on the first, late on the 2nd of the month)
9. Seller Remains On Deed (No risky wrap-around deals).
10. Seller Retains Tax Shelter (Naturally)
11. No Long Vacancies (Just give generous rent credit and the phone rings off the hook).
12. Positive Cash Flow (My daughter’s first 3 words).
13. No Realtor Commissions To Pay (6-7% Savings) (Hang up the gold jacket).
14. No Closing Costs (Tenant/Buyer pays for these in conventional financing).
15. Safer Than Conventional Rentals (Very few ‘tenant from hell’ stories here).

Tenant/Buyer Advantages - Imagine negotiating and moving into the home of your dreams today and buying it several years from now! Consider the market need for helping others who can’t get past the bank by helping them to get started in home ownership. Yep, the advantages for the Tenant/Buyer are such that they will beat a path to your door.

1. Very Low Down Payment (1-2% vs. 10-30%)
2. No Loan Qualification Necessary Up-front
3. Rent Money Is Working For You (AKA: Rent Credit)
4. Option Consideration Is often Credited 100%
5. Price Is Usually Locked In Up-front
6. Profits From Any Appreciation
7. Time To Check Out The Home ( Make sure the roof really doesn’t leak)!
8. Time to Check Out the Neighborhood and Neighbors (I would hate to discover that my neighbor runs a combination pit bull training and Karate school in his garage)! Check out the movie The Suburbs if you doubt me !!!
9. Time To Obtain the Best Financing (No pressure, no rush, no bank financing up-front).
10. No Taxes To Pay (Libertarians love Lease Purchasing)!
11. Buys Time To Repair Credit or Develop Needed Down Payment (The luxury of time).
12. Quick Move In Time (Back up the truck to the garage).
13. No Lengthy Escrows or Mortgage Approvals
14. Rents are Negotiable (Heck everything is negotiable)!
15. You can live in the home of your Dreams today which you can Buy Tomorrow (Good idea)!

An Investor’s Viewpoint - The Lease Purchase has everything an investor needs to make a prudent and profitable investment in Creative Real Estate. Utilizing very small down payments of 1 - 2 %, an investor can control several properties that normally require 20 - 30 % in down payment. For example, on an investment property valued at $200,000.00 an investor can expect to put between $40,000.00 to $60,000.00 down for the purchase. Through a Lease Purchase, the investor can control as many as 10 or more properties with the same amount of money! This is Maximum Leverage at its best! Lease Purchasing is a field where there is little competition. Let everyone else do the foreclosures and fixer uppers. Let’s works smart and develop multiple streams of cash flow with a profitable concept. Best of all, everyone can win!

Investor Advantages

1. Maximum Leverage - Minimum Cash Outlay (What’s better than controlling properties with a mere pittance)?
2. Profits. Almost too numerous to list here!! (Option Consideration, Positive monthly cash flow, Cash at close or a note, Assignment fees, Property sale, Consulting fees and more).
3. Very Little competition (Ask Donald Trump, he loves options).
4. No Maintenance (Hang up your plunger)!
5. Price Protection (You can make money if the real estate market goes up and can give the property back to the owner if it goes down. Much safer than traditional investing).
6. No Landlording (See the movie Pacific Heights).
7. Control Without Overhead (A great home business, a 30 second commute)!
8. Positive Cash Flow (There’s that word again)!
9. Minimum Risk - Little money in the deal, no bank qualifying necessary.
10. Peace Of Mind (I have been to the mountain top of real estate success).
11. Minimal Liability (You can Wheel & Deal on properties without the usual risk).
12. Appreciation (The price is locked in so you can profit in upswings).
13. Assignment (Be the middleman and wholesale the deal to another. You’re out of the loop).
14. Paper - Create high quality notes through your own Lease Purchase Transactions.
15. Profits (Yes, its worth saying twice)!

In summary, Lease Purchasing is a good way for the beginner as well as the seasoned investor to be involved in creative real estate. Lease Purchasing can generate high profits with minimal risk. It is a Win/Win concept for all the principle parties concerned.

Paying Buyers Closing Costs

Seller vs. buyer costs. Buyers and sellers often negotiate who will pay certain closing costs. For example, the seller may agree to pay part of the origination fee, or give the buyer cash to do a needed repair. Keep in mind that any agreement reached by you and the seller must be specified in the purchase agreement.

Mortgage-related costs. Mortgage-related closing costs generally are associated with your loan application. They vary, but here are some of the most common ones:

• The loan origination fee, also known as loan origination points, covers the administrative costs of processing the loan. This fee may be expressed in "points," with each point equaling one percent of the mortgage (for example, one point on a $200,000 mortgage would equal $2,000).
• Loan discount points are additional funds you pay the lender at closing to get a lower interest rate on your mortgage. They also are expressed as percentage points.
• The appraisal fee pays the lender's cost to determine the value of the property.
• The credit-report fee covers the lender's cost for ordering your credit report credit bureau.
• Prepaid interest covers the interest charge on the mortgage, calculated as a daily rate, from the date of closing to the beginning of the period covered by the first monthly mortgage payment.
• Escrow accounts are required if your lender will be paying your homeowner's insurance and property taxes. Your lender sets up the escrow account by adding the cost of the insurance and taxes to your monthly mortgage payments, and keeping those funds in reserve until the bills are due. The bills are sent directly to your lender, who makes the payments for you from funds that you have prepaid.

  Government-imposed costs. Some of the more common taxes levied by state and local governments include:

  • Property taxes, which are calculated annually based on the value of the real estate involved in the transaction, and paid to the local government.
  • Recording fees, a tax for recording the purchasing documents.
  • Transfer taxes, a fee on the transfer of property.

  Property taxes are typically prorated between the buyer and seller. For example, if the seller has paid taxes for a period of time beyond the closing date, you would reimburse the seller. But if the seller has not yet paid taxes for the current period, the amount owed is deducted from your settlement payment. When this occurs, it is called an "adjustment."