How HomeDividendsm Works
HomeDividendsm partners with your lender to add a guarantee to your mortgage. That guarantee reduces the lender’s risk, which can help you qualify with less money down or with a non-traditional credit profile, while keeping your long-term incentives aligned.
1. Pre-Qualification
You apply with a participating lender or through a HomeDividendsm partner. Together, we review your income, savings, and payment history—including additional data where appropriate for credit-invisible or self-employed borrowers.
2. The HomeDividendsm Guarantee
If you qualify, the lender issues a mortgage with a lower required down payment. HomeDividendsm then guarantees the loan balance, giving the lender added protection against certain losses.
3. You Make Your Mortgage Payments
You make a standard monthly mortgage payment to your lender. The lender pays a modest ongoing fee to HomeDividendsm for the guarantee as part of the loan’s economics.
4. When You Sell or Refinance
If your home has increased in value and you eventually sell or refinance, HomeDividendsm receives a small, pre-agreed share of the appreciation. You keep the rest of the equity, just as you would with a traditional mortgage.
HomeDividendsm vs Traditional Mortgage Insurance
HomeDividendsm Guarantee
With HomeDividendsm, there is no separate monthly payment to a mortgage insurance company. Instead, our compensation comes through a modest fee built into the loan economics and a capped share of your home’s future appreciation, but only if it increases in value.
Traditional MI
With traditional mortgage insurance, you typically pay a monthly
or upfront premium to protect the lender. You don’t share in any
benefit from that insurance, and your payments continue until the
insurance is removed or the loan is paid down.
Illustrative Example
Consider a $400,000 home purchase. With a traditional 20% down payment, you would need $80,000 upfront. With a HomeDividendsm-backed structure, you might put down 0%, keeping $80,000 available for savings or investments.
After several years, if your home has appreciated and you choose to sell or refinance, HomeDividendsm receives a small percentage of the appreciation. You keep the majority of the upside, plus the equity you’ve built by paying down your loan.
Exact terms vary by loan, location, and borrower profile. All details are disclosed clearly in your loan documents before you commit.