"All the research we see says that the growth in our business will come disproportionately from first-time homebuyers," said Rick Aneshansle, a senior vice president at U.S. Bank.
"Payment Buster follows along with our acquisition of The Leader
and some other products we've developed in the last year as parts of an initiative to gain a larger share of that market."
The largest savings in the new product were achieved by eliminating the private mortgage insurance requirement for borrowers who can't afford a down payment of at least 20 percent of the total loan.
said technological improvements in the mortgage approval and processing steps, and savings the company achieved in some of it back-end financial structures contributed to the significant price reduction.
said the bank was willing to spend some money because of the importance of the market.For instance, the lender will pay to insure the mortgage loans.
"How do you kick off a relationship with a first-time homebuyer?We knew what was important to them, and we knew we had to put our money where our mouth is," Aneshansle
But don't expect Payment Buster to be the final chapter in the mortgage industry's product pursuit of first-time homebuyers.
"They're contributing almost one-third of our sales now," Aneshansle
In comparison, that region had minimal mortgage activity when it was covered by the former U.S. Bank
, a company that had shifted its focus from residential mortgages in the prior decade.
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