The Solution to the U.S Down Payment Dilemma

Those looking to buy a home in the States are all currently saying the same thing is holding them back….They can’t seem to afford the down payment.

Down payments on houses can be burdensome and oftentimes weigh on the ability to buy a home. In some cases, it calls for years of disciplined saving. Something that can be difficult for someone who wants a home and wants it now.

That’s where the start-up company Loftium comes in with a solution. This is a business started by 29-year-old Yifan Zhang of Seattle.

As someone who has personally heard her friends talk for years about the down payment dilemma, she finally decided to do something about it.

Zhang started as any other Airbnb business owner. Renting out one room in her townhouse to generate extra cash. Little did she know just how much cash she could actually generate.

Quickly into her business, she was earning enough to completely pay for her mortgage and then have some left over!

That’s when the idea dawned.

Zhang decided to eliminate the “down payment” problem by supplying her friends or first time home buyers with the down payment they needed…With only one condition.

They must rent out a space of their house as an Airbnb, and give Zhang a portion of it.

The conditions can change upon case but Zhang is mostly looking for the same things. Approximately two/thirds of all profits for one to three years.

It is also a regulation for each client that the spare room is continuously rented out with the exception of 8 days throughout the year, in which the homeowner is allowed the time for personal use.

Though, a small business started by one couple in Seattle, Zhang has big plans that it will likely thrive in other parts of the country as well… is loftium going to take off around the states?

While only being certified to lend $50,000 to borrowers, it is vital that buyers are aware they are likely going to need to produce some contribution for the down payment as well as proof that they have a greater income than the Airbnb they are mandated through loftium.

What if the clients Airbnb is not profitable?

In this case, loftium takes full responsibility. This method, showing the owners strong belief in the company.

Zhang’s only time restriction is that it takes no longer than three years.

In this time if the Airbnb does pays off the down payment, loftium will continue to profit for the remainder of the time. With no cap as to how much they can earn.

Zhang, well early on into her down payment-lending business, seems to have no regrets and is expecting the business to take off in relatively no time at all. She mentioned that it is in their near future as a company to hopefully expand to new states and continue helping people afford homes.

Zhang is uninterested in working with people who perhaps want to own an entire home strictly to rent out Airbnb but strictly for people who otherwise could not afford a home for their families.  

She is really only looking to do good in the communities she is reaching, and so far, she is.

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