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Welcome to Startups. Ready to own your dream home but can’t get a mortgage? Not to worry, as homeownership has never been so reachable.
Divvy will enable a person or family to select a home they’d like to someday own, then helps them to buy that home. The prospective buyer can give as low as two percent toward a down payment. Divvy pays for the rest, then it collects a monthly amount that includes both market-rate rent plus an equity payment.
It’s easy to appreciate why this might be attractive to potential homebuyers who can’t secure a traditional mortgage in the current market, where many of them don’t suffer from poor credit, but are contractors, and/or self employed workers who don’t have the required months of salary stubs to show strict bankers.
Interestingly, when using Divvy, you are required to take a quiz as part of the closing process and also attend a webinar to ensure you understand what you’re getting into. The property must also pass inspection and, of course, you’ll need to sign your l ease and send initial payment with sufficient time to clear before closing. Once i t closes, you’ll be locked into a three-year l ease, with no obligation to buy at the end of the 36-month term.
Over time, you earn “equity credits,” which are like a home savings account. At any time, you can convert those equity credits into a down payment to purchase the property or you can also choose not to buy the home after your three-year l ease ends, at which point Divvy will sell the home and cash out your equity credits.