Industry NewsMortgage

First-time buyers get payment protection

CAR program gets additional backing from NAR

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The California Association of Realtors has purchased about 400 insurance policies for first-time homebuyers that could provide up to $1,500 a month in mortgage assistance for six months in the event they lose their jobs.CAR announced the program on April 2, saying it would use $1 million its members had donated to a charitable fund earmarked for affordable housing to buy one-year mortgage payment protection policies for about 3,000 first-time homebuyers instead.As of late July, 384 applications have been approved and an additional 22 applications were in the pipeline awaiting approval, CAR said.The program has proved to be such a success, CAR said, it has received a $420,000 grant from the National Association of Realtors to extend the program once the initial funding for the program runs out.Consumer advocates have questioned the value of such "single event" insurance policies, but as unemployment levels continue to rise they have become a marketing tool for mortgage lenders...