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Zillow's 1% Down Mortgage Program: A New Tool for Real Estate Agents

In the dynamic world of real estate, agents are constantly seeking tools and programs to better serve their clients.

Zillow Home Loans' recent introduction of its 1% Down Payment program is one such tool that agents should be aware of. While it presents an intriguing option for certain buyers, it's essential to approach it as one of many available tools, rather than a one-size-fits-all solution.

Understanding the 1% Down Payment Program

Zillow Home Loans' initiative allows eligible home buyers to make a down payment of just 1% on their purchase. To sweeten the deal, Zillow contributes an additional 2% at closing. Initially available in Arizona, there are plans to expand this offering to other markets.

Why It Matters to Agents

  1. Diverse Client Solutions: The program can be especially appealing to first-time buyers or those struggling with the initial down payment. It provides agents with another option to present to clients, broadening the range of solutions they can offer.

  2. Potential for Faster Transactions: A reduced down payment can mean a shorter saving period for some buyers, potentially speeding up the buying process.

  3. Knowledge is Power: Being informed about a wide range of programs, including this one, positions an agent as a knowledgeable and versatile professional.

However, A Word of Caution

While the 1% Down Payment program is an exciting addition to the market, it's crucial for agents to advise their clients to approach it with a discerning eye:

  1. Interest Rates: Zillow has not disclosed the interest rates associated with these 1% down loans. It's possible that the rates might be higher than other available options, especially if a client can afford a larger down payment elsewhere.

  2. Comparative Analysis: Before jumping on board, clients should be encouraged to meet with a mortgage lender to compare all available options. This ensures they're making an informed decision that aligns with their financial situation and long-term goals.

  3. Holistic Financial Picture: A lower down payment might sound appealing, but it's essential to consider the overall financial implications. Agents should remind clients to factor in other costs, such as PMI (Private Mortgage Insurance), which might be applicable with lower down payments.

Leveraging the Program as an Agent

  1. Educate, Don't Push: Use the program as a talking point in discussions, but always emphasize the importance of comprehensive financial consultations.

  2. Collaborate with Mortgage Experts: Build relationships with mortgage lenders who can provide clients with a detailed analysis of their options, ensuring they make the best choice for their circumstances.

  3. Stay Updated: As with all tools, the landscape can change. Stay informed about any updates to the program and the broader mortgage market to provide the best advice.

Zillow's 1% Down Payment program is an exciting addition to a real estate agent's toolkit. However, it's essential to position it as just that – another tool. By ensuring clients have a comprehensive understanding of all their options, agents can truly uphold their role as trusted advisors in the home-buying journey.

Have you ever worked with Zillow Home Loans? Share your experience below in the comments or with a colleague in an upcoming CE Class!


Zillow Home Loans. (2023, August 24). Zillow Home Loans offers a 1% down payment option, opening homeownership to more borrowers. Zillow Group.

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