Project

Home Financing

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Home Financing

Housing is the largest regular expense for most American families. And although prices vary significantly across the nation, living in a lower-cost area does not always ease the path to homeownership. Many families in less expensive regions struggle to buy a home because small mortgages are hard to obtain.

High fixed costs and a system that ties lenders’ compensation to loan size have made smaller mortgages—those under $150,000, for example—less profitable than larger ones for banks, credit unions, and other traditional mortgage lenders. As a result, millions of families have turned to alternative financing products to purchase homes, but these options often cost more and offer fewer protections than mortgages.

Pew studies the alternative financial arrangements that people use to buy lower-cost homes and examines the barriers that lenders face to offering small mortgages—with the goal of informing policymakers and other stakeholders about market practices, evaluating borrower protections and experiences, and promoting access to safe, affordable home loans.

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¿Por qué millones de compradores de viviendas en los EE. UU. recurren a opciones financieras riesgosas?
Este breve video describe el desafiante camino a la vivienda propia
Family eating dinner at table
Family eating dinner at table
Issue Brief

Millions Using Risky Financing Arrangements to Buy Homes

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Issue Brief

Most homebuyers in the U.S. use mortgages to purchase their homes. However, many others use alternative financing arrangements, such as rent-to-own, that research indicates are generally riskier, more costly, and subject to far weaker consumer protections and regulatory oversight than traditional mortgages.

Homeowner Mr. Thomas Holley
Homeowner Mr. Thomas Holley
Issue Brief

What Has Research Shown About Alternative Home Financing?

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Issue Brief

Most people in the U.S. use a mortgage from a bank or other financial institution to finance a home purchase.

OUR WORK

Home Visitors Annai Burrola (white dress) and Jessica Apodaca (red shirt) meet with Santa Fe, NM families via United Way of Santa Fe as part of the First Born Home Visit Program.
Home Visitors Annai Burrola (white dress) and Jessica Apodaca (red shirt) meet with Santa Fe, NM families via United Way of Santa Fe as part of the First Born Home Visit Program.
Fact Sheet

Los compradores de viviendas hispanos son más propensos a usar financiación riesgosa

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Fact Sheet

Desde 2014, la adquisición de viviendas en la comunidad hispana aumentó cada año y representa más de la mitad del crecimiento de la compra de viviendas en los EE. UU. desde 2010.

The U.S. Treasury Building, photographed on Friday, July 16, 2021 in Washington, DC.
Article

Homeowners With Risky Mortgages Eligible for Relief

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Article

The U.S. Treasury Department released guidance in August that made financial assistance available to homeowners experiencing financial hardship linked to the COVID-19 pandemic.