DETROIT, MI – First time homebuyers now have a new means of buying into the red-hot housing market thanks to the nation’s largest mortgage lender, Quicken Loans (NYSE: RKT). Tuesday the company announced that it will now be accepting the first-born child of mortgage applicants in lieu of a 3.5% down payment for FHA qualifying loans. In some markets, this could amount to over $20,000 towards a family’s first home.
“We know that many families are struggling to build up the savings needed to buy their first home,” said Quicken Loans communications director Sam Oleson, “with U.S. median home prices now up over $300,000, many people are wondering if they will ever have enough to purchase a home. Our new first-born sacrifice product opens the door for these struggling families.”
The program is open to FHA qualified buyers in all 50 states and the terms allow for home purchase prices up to $650,000. In exchange for sacrificing their first-born child to the bullheaded god Moloch, buyers will receive a credit of 3.5% of the purchase price, allowing FHA buyers to enter a mortgage with effectively zero money down. Upfront taxes, insurance and fees will still be required separately.
“We are really going to miss Caden,” said Sarah Jacobs, one of the programs first applicants, “but the reality is that it’s either this program or we continue to rent forever. We want a house that our remaining children can grow up in.”
The Jacobs family are not unique. Data from the St. Louis Fed show that approximately 3/5 of families with children cannot afford to save up enough money for a down payment. The seemingly unstoppable increases in housing prices have made home seeking families look at what other assets they can use to meet creditworthy requirements. Quicken Loans is the first company to provide a means of directly converting children into equity.
“We tried saving as much as we could, but prices kept going up faster than we could save. I’m glad that Quicken Loans is there for families like us,” said Jacobs.
The offering is not without its detractors however. Financial watchdogs are concerned that child sacrifice may not pay out equally for families of different racial backgrounds; a fact that may halt the product unless Quicken Loans can show that they meet Fair Housing rules.
“Families of color on average purchase lower cost homes, and as a result will be receiving a lower payment than white families for their first-born child sacrifice,” said NAACP financial equity project director Jim Jackson, “We will be pressing Quicken Loans to make sure that when a child is sacrificed, their parents are being compensated equally, regardless of the child’s skin color. Anything less would be a tragedy.”
Possible race-based lawsuits notwithstanding, the program to sacrifice one’s child for a down payment on a house is currently open and seeking applicants.