Rocket to offer renters up to $5,000 in closing cost credits

Rocket Mortgage says it will offer closing cost credits to renters with a 12-month payment history in a first-of-its-kind program.

The lender will give mortgage applicants 10% back on their last year of rent payments for closing credits of up to $5,000 in its "RocketRentRewards" program, it announced Monday. Consumers can verify their monthly payments from multiple properties over the past 12 months.

Renters can also use the credit to buy down their interest rate with discount points, said Bill Banfield, Rocket's chief business officer and economist.

"We think it's a good opportunity to bridge the gap for folks that might think it's either too expensive or are renting for flexibility and would rather have a home to call home," Banfield told National Mortgage News.

The program is available for conventional loans and Rocket isn't charging borrowers to use the credit. Banfield said it's part of Rocket's suite to attract home buyers, including its 1% downpayment product and a lender-paid buydown loan.

The lender's new program is part of Rocket Cos.' "Own the Dream" campaign, which included a high-profile Super Bowl advertisement. The company last month also combined its mortgage, real estate and personal finance offerings under the Rocket.com domain.

Closing costs can vary significantly nationwide, and average $7,335 nationwide according to Corelogic. Those costs have increased with median sales prices still rising, albeit slower, on an annual basis. Rising homeowners insurance costs are also increasingly weighing on prospective buyers. 

Renters make up a third of U.S. households, according to 2024 data by the Joint Center for Housing Studies of Harvard University cited by Rocket. Home prices and unattractive rates have both locked-in current homeowners with pandemic-era rates, and locked-out renters seeking homeownership. 

Rental rates have also soared in recent years, and the majority of consumers recently surveyed by Fannie Mae expect those prices to continue to heat up. 

The industry has experimented with helping renters attain homeownership. Rent reporting platform Esusu reported last year it helped deliver 15,000 new originations via its program, part of a Fannie Mae pilot with three vendors running through this year.