You might have seen this new logo appearing on an email signature or in some of our material. Home Today™ is a non-profit based out of Las Vegas whose mission is to help people become homeowners. We now have a strategic alliance with them and it is really exciting.
I know you have a few questions in your head as to why, so let’s dive into questions and get you some answers.
Why a strategic alliance? We found our goals of helping people get into homes was limited to only being able to help them if they qualified for our rent to own program. If they didn’t qualify, we simply had to turn them away and recommend that they get some credit repair.
Through Home Today we are able to provide many different options to help them become homeowners. Home Today offers many solutions to help prospective home buyers. In addition to our mortgage ready program, Home Today’s programs include multiple down payment assistance options, financial literacy classes, foreclosure prevention education, and of course, their HomeSMART™ rent to own program which combines features of our rent to own program with their rent to own program, coupling a more in depth analysis of the client’s solvable financial issues with ongoing counseling and monitoring of the client’s progress. Our goals are aligned with both companies which makes this a perfect fit, but that’s not all.
When future homeowners came to see us before, they were skeptical of us and our program. They had heard rent to own programs didn’t work. While it is true that other programs were not effective, they had not seen our program yet and didn’t know it was different. We now have 25 successful families who have bought their home back from us in our program. Home Today has helped us attract more future homeowners because potential buyers feel less intimidated and skeptical about working with an established and reputable nonprofit housing agency like Home Today. This has been tremendously useful in attracting deal flow.
Does this mean someone else is in charge of the underwriting for the rent to own program? Absolutely not. We continue to make the final decision when it comes to the underwriting of the future homeowner and the approval for purchase of the property that we are funding, like we always have before. Everything that we did prior to our alliance with Home Today is still 100% the same or better. All of the qualifying or underwriting of the future homeowner is identical, but now has additional benefits. Since Home Today’s main goal is to figure out how to help these clients get into a home, they look even deeper into their finances and create a personalized budget for them. This gives us a better understanding as to each client’s ability for success. When it comes time to fund the purchase of any property, all the same procedures remain in place, with Steve or myself underwriting the property and approving any purchase to be funded by us.
Why did Home Today want to enter into a strategic alliance? There are multiple reasons, but primarily so they could work with one funding alliance. They had been looking for the right company for a long time, and since we had already been doing the rent to own program it was a perfect fit.
How does it work with a non-profit? A non-profit functions basically the same as a for profit business. They have to bring in income, donations, or grants to pay for their expenses of employees, overhead, etc. They are not required to pay income taxes and are able to retain reserves for the future. In addition, Home Today is HUD certified so they fall under many other guidelines that must be followed. However, this also opens the business up for other opportunities that only come with that designation.
How has this helped with deal flow? Home Today’s extensive contacts, significant existing client base, and their entire portfolio of programs providing multiple funding opportunities have helped tremendously and we are only getting started. As I am writing this article, we have a pipeline of over $4.2M in homes expected to be purchased over the next 90 days. This is, of course, not including anything new that comes our way in the next 90 days. Did I tell you that this was exciting!?
We believe this to only be the beginning and expect our pipeline to increase rather quickly as word about our alliance gets out. Stay tuned as an investor. We have additional opportunities opening up for you in 2015.