Detroit-based Rocket Mortgage, the retail home lender and part of Rocket Cos., has introduced ONE+, a new 1 percent-down home loan program that was developed to dramatically increase access to homeownership for millions of low-to-moderate-income earning Americans.
With ONE+, a homebuyer is only required to make a down payment of 1 percent of the purchase price and Rocket Mortgage will cover the remaining 2 percent needed to reach the required threshold for conventional loans.
In addition to reducing upfront costs, ONE+ eliminates the expensive monthly mortgage insurance fee for the client, which is traditionally required if the buyer places less than 20 percent down on their purchase.
“Rocket Mortgage prides itself on finding innovative solutions and lending programs that help clients achieve their goals in any market cycle,” says Bob Walters, CEO of Rocket Mortgage. “No other lender has a mortgage option that makes affordable homeownership possible for as many Americans as ONE+.
“We talk with people from all walks of life every single day — many of whom are ready to own a home, and could easily make the monthly mortgage payments, but are having trouble saving for a down payment. ONE+ is a response to that feedback and the latest example of Rocket’s commitment to creating programs that help make homeownership more attainable.”
Designed to help everyday Americans achieve homeownership, ONE+ is available to homebuyers purchasing single-family homes — including manufactured homes — whose income is equal to or less than 80 percent of their area median income (AMI). With this expansive AMI eligibility, Rocket Mortgage estimates that more than 90 million people can meet the income requirements for this program — based on publicly available income data.
As an example of the savings possible through ONE+, a homebuyer purchasing a $250,000 home typically needs a minimum of 3 percent down, or $7,500. Now, they will only need a $2,500 down payment. In addition, ONE+ offers mortgage insurance at no cost to the client, which on a $242,500 loan, can be as much as $245 per month. That improves a homeowner’s monthly cash flow and can save as much as $20,500 over the first seven years after closing — the average amount of time mortgage insurance needs to be paid.
This is the third initiative Rocket Mortgage has launched in the last six months with affordability in mind. Other programs such as BorrowSmart Access, Purchase Access, and Purchase Plus focus on addressing challenges for homebuyers in underserved communities. By offering a $3,000 credit with BorrowSmart Access and a $7,500 credit with Purchase Plus, hurdles such as closing costs and down payments are lessened and accessibility is increased.
Homebuyers can apply for ONE+ using Rocket Mortgage’s industry-leading digital mortgage experience RocketOnePlus.com and on the Rocket Mortgage mobile app. They can also apply through one of the thousands of mortgage brokers across the country who partner with the lender through Rocket Pro TPO.
