Lennar Corp., Miami (NYSE:LEN) on Tuesday announced its Eagle Home Mortgage unit unveiled a mortgage program with a feature that helps pay off outstanding student loans – up to $13,000, depending on sales price.
Borrowers with Eagle Home Mortgage's Student Loan Debt Mortgage Program can direct up to 3% of the purchase price to pay their student loans when they buy a new home from Lennar. Eagle Home Mortgage is a full-service mortgage lender and part of the Lennar family of companies. Lennar contributes the 3%, which does not increase the price of the home or add to the mortgage loan balance.
"Americans are more burdened than ever by student loans, with $1.3 trillion in outstanding student loans spread out among 42 million borrowers," said Jimmy Timmons, president of Eagle Home Mortgage. "Particularly with millennial buyers, people who want to buy a home of their own are not feeling as though they can move forward. Our program is designed to relieve some of that burden and remove that barrier to owning a home."
As research by a variety of academic and financial institutions reveals, a significant majority of college-educated people who want to buy a home feel constrained by outstanding educational loans. According to data compiled by the New York Federal Reserve, the average outstanding balance among borrowers with a student loan is $26,700.
"Lennar is proud to offer this unique and groundbreaking program to our buyers," said Jon Jaffe, COO of Lennar. "From our signature Everything's Included® program to loans that address the concerns of today's buyers, Lennar is committed to helping families realize the dream of owning their own home. Education is an investment in yourself and your community – and Lennar wants to help ensure that college loans don't unnecessarily stand in the way of home ownership."
With the Student Loan Debt Mortgage Program, buyers must meet credit and income requirements and can qualify for loans with down payments as low as 3%. The Student Loan Debt Mortgage Program is being offered on a trial basis with new Lennar homes nationwide.
At closing, Lennar contributes up to 3% of the purchase price to pay down student loans incurred while attending universities, colleges, community colleges, trade schools and other certificate-granting programs. It is not intended for parents who may have taken loans to finance a child's education. The maximum loan amount is $424,100. In addition to the 3% contribution to student loan balances, buyers may also be eligible for other incentives – such as credits toward closing costs.
