Helping Mortgage Lenders Reach Underserved Neighborhoods
Since the Community Reinvestment Act (CRA) was introduced in the 1970s, lenders have struggled to find new and meaningful ways to serve low-to-moderate (LMI) communities and tackle homeownership inequality. They do their best to donate to charity or help their community through fundraising and community events. Unfortunately, low-income individuals still have a much harder time getting a mortgage. We've created a Socially Responsible Real Estate Technology that will increase your mortgage business and improve your lending opportunities in LMI neighborhoods.
The Problem: Unequal Access to Real Estate Resources
In a 2020 Forbes article titled Redlining’s Legacy Of Inequality: Low Homeownership Rates, Less Equity For Black Households, Real Estate writer Brenda Richardson states, "The national homeownership rate is lower for Black families than white families—44% versus 73.7%." She continues by suggesting this homeownership gap contributes to the overall wealth inequality in the US. Minorities don't have proper access to mortgage lenders and can't accumulate assets.
Access to Agents
Especially in areas where most residences are rented rather than owned, prospective buyers have a hard time finding an agent to show them a home they're interested in. They might even have a hard time finding for-sale homes in the first place. Unfortunately, some agents refuse to serve certain areas if the homes are valued too low.
With HomeTraq, the buyer is protected from discrimination because the agent won't see the buyer's face or name before they accept the showing request. Also, some agents won't show buyers a house before they're pre-approved for a loan. In this case, agents are to serve as an educator and encourage the buyer to talk to a lender.
The act of redlining is illegal, but the effects continue to impact low-income neighborhoods. Showing consumers that not only is redlining a thing of the past, but you're encouraging LMI communities to apply for a loan is an admirable mission.
The Solution: HomeTraq Home Touring Technology
Down Payment Assistance
Notifies the buyer and financial institution when a requested home tour falls in a neighborhood that qualifies for Down Payment Assistance based on FFEIC census tracts. Hundreds of thousands of dollars go unused by potential homebuyers every year. Most of the time, it doesn't get claimed because the buyers don't know it's available. HomeTraq educates buyers and can make the homeownership dream a reality for those that don't think they can afford it.
Increase Mortgage Business from your own Customer Base
HomeTraq is a real estate solution to a mortgage problem. When partnering with HomeTraq, we refer customers who come through a lender's pipeline back to their mortgage services. Also, we notify the mortgage officer when their customers are shopping around.
Financial institutions lose 93% of the mortgage opportunities from their own customers every year. HomeTraq can double your mortgage conversions by simply notifying the lender when one of their customers is home shopping. The cost of acquisition is much lower than other lead gen sources because you only pay when your customer goes on a home tour.
Automated Home Valuation (AVM) and what it can do for your Tax Assessment
Your property value determines how much you pay in real estate taxes. A bad assessment could cost you hundreds, or in extreme cases, thousands of dollars a year. Good thing you can contest your property's assessment and possibly get some money back in your pocket.
How to find out how much your home is worth
An Automated Valuation Model (AVM) is a tool that generates a rough estimate of your home's value based on tax records and other comparative factors. You can request a valuation of your property by entering your address and email into a valuation request form:
Some AVMs are free to use and available to the public. A more detailed report might cost somewhere around $20. Each model is different, so if you're not happy with the first valuation, it's not a bad idea to get a second opinion. Keep in mind, an AVM is a rough estimate based on publically available data.
If you're serious about contesting your property taxes, you will need more than just an automated report to plead your case. Professional consulting firms are available to help, but it might cost you some time and money. However, if you feel your taxes were wrongfully calculated, it might be worth digging a little deeper.
How it impacts your property taxes
Tax Assesors in your local Treasury use what is called "fair market value" to determine the value of real estate in their area. They use a similar process to AVMs by evaluating similar properties that recently sold in the area, and compare them to the tax records for your property.
Assessments are somewhat subjective because they're an estimate based on many factors. While a lot of Treasury departments have automated methods, there is a human element to determining property value. So, it is possible to argue that an assessment is inaccurate. Particularly, homeowners tend to contest their assessment when the estimate seems too high. If your property is valued at a higher price, you'll owe more in property tax.
If you're looking to sell your home, it's exciting to get a high valuation. However, if you don't plan to sell and get a surprising valuation, it might be worth looking at other options.
Resources to contest your tax assessment
Contesting your property assessment is a commitment, but it could be useful if you want to save some cash. Certain companies like Admiral Consulting help you contest your assessment for a percentage of what you save over a few years. Depending on how much you believe the assessment is wrong, it may be worth your time to talk to someone about your options.
Some customers are seeing up to a 10% spike in their real estate taxes from last year. $3,450 is the median property tax amount in Missouri for a home that's valued at $250,000. An assessment that is off by 10% would add almost $400 to your tax bill. Even for a modestly-priced home, it's worth speaking to someone about contesting your property tax.
All the resources you need through socially responsible real estate
HomeTraq is focused on helping you, as the buyer, through all the hoops and hurdles of the home buying process. We want to make the home-buying process is a great experience by facilitating convenient home tours and working to connect you to the financial resources that matter to you the most.
What's Socially Responsible Real Estate?
Homeownership inequality can be hard to overcome. A socially responsible real estate technology focuses on equality for ALL homebuyers. We work to provide resources to buyers that close the homeownership inequality gap and focus on eliminating discrimination in the home-buying process. That also includes encouraging lenders and agents to develop and promote programs in low-to-moderate income and majority-minority census tracts.
The Home Tour Experience
We want you to be comfortable in every step of the home-buying process, and that includes home tours. You can request a home showing using HomeTraq and quickly receive a confirmation from one of the agents in our network. We want to protect you as a buyer, so we never share your demographic or personal information with the agent. This buyer anonymity prevents discrimination in the home buying process and allows you to work with multiple agents, ultimately deciding which one you wish to continue to work with.
Financial Resources for You
One of the other biggest steps in the home-buying process has to do with all things financial. When buyers use HomeTraq's services, they are connected with financial options and assistance based on the properties they're interested in. If you book a home tour with HomeTraq, once the tour is confirmed, we will let you know if that home qualifies for special loan programs and whether you might qualify for Down Payment Assistance.
Down Payment Assistance
Lenders offer a variety of down payment assistance plans based on a variety of variables like low-to-moderate income, majority-minority census tracts, or first-time home-buying status. We understand one of the biggest hurdles can be the down payment, so we want to help you find every financial opportunity. We will work to connect you to these assistance programs if you qualify or if a property you're interested in qualifies. Many funds in these programs go unused because buyers don't know about them, and we want to fix that.
If you want some more information about finding Down Payment Assistance (DPA) in your area, check out this blog post: https://www.hometraq.com/blog-details/how-to-find-down-payment-assistance-in-your-area