That money is held on behalf of the customer to be used toward a down payment when the customer is ready to purchase the home. The customer contributes a payment of one to two percent of the home's value at the beginning of the lease. When a bid is successful, customers can expect a quick closing process so they can get the keys and move in. Once the customer finds their dream home, Divvy bids to purchase the property. Divvy knows the homefinding process is personal and will work with the agent of the customer's choice. Once approved, the customer receives a home-buying budget and pairs up with a real estate agent to start shopping. It will then run a soft credit check, complete a background check and ask for a government-issued ID. Divvy requires a minimum household income of $2,500 per month and proof of three months of income. The process starts when buyers complete a five-minute online application. If a customer is ahead of schedule and wants to purchase before their lease ends, they can buy their home from Divvy whenever they are ready. The company has designed a program for would-be homeowners who don't quite qualify for a traditional mortgage because of tighter lender requirements, not quite enough savings or a range of other reasons.ĭivvy helps by offering a program that allows customers to build savings with their Divvy payment, boost their credit score through free credit counseling and ultimately position themselves to qualify for a traditional mortgage at the end of their three-year lease. This situation may seem bleak, but San Francisco-based start-up, Divvy Homes offers aspiring homeowners another option to make their dreams a reality.ĭivvy Homes is dedicated to making homeownership more accessible to American families. The company cited Barclays, Goldman Sachs, Cross River Bank, LibreMax Capital and Brigade Capital Management as key lenders enabling Divvy’s growth.( NewsUSA) - Recent inflationary pressure, challenging financial circumstances and a looming rise in interest rates have made aspiring homeowners across the country feel like the dream of owning their home is slipping away from them. More than 750,000 Americans have applied for Divvy’s program since its inception in 2017, according to a press statement. Rent payments are structured such that customers will have saved up for a 10 percent down payment on the home after three years, at which point, they can purchase the home, or walk away with their savings. The company purchases a home on behalf of its customers, who then contribute 1 to 2 percent of the home’s value toward a down payment while renting out the home. Divvy’s 10-year goal is to service move than 100,000 families in becoming homeowners. Specifically, the new funds will be used for refinancing two of the company’s existing debt facilities so that it can purchase more homes and service more customers. The company did not immediately respond to requests for an updated valuation. As of the Series D, Divvy was valued at $2 billion. The news follows Divvy’s $200 million Series D, netted just two months ago in August, and will allow it to serve more Americans in their path to homeownership through its three-year rent-to-own program, the company said. Rent-to-own proptech startup Divvy Homes has brought in a total of $735 million in new debt financing, the company announced on Tuesday.
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