Down payment help for home buyers outside Seattle

Loftium, which offers to help you boost your down payment for a catch, is expanding beyond Seattle.

A Seattle startup that helps homebuyers beef-up their down payments -- with a catch -- is extending the service outside of the city limits.

Starting February 1, Loftium will help prospective home buyers as far as Everett, Tacoma, out past Snoqualmie.

John and Elly Irby took us on a virtual tour of the new home they close on in February.

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"This is the mother-in-law," Elly said, showing us the photos. "There is going to be a microwave dishwasher and smaller fridge here."

The mother-in-law apartment was key to helping them put down a larger down payment for their home. That's because they're buying it with the help of Loftium which gives you up to $50,000 for a down payment.

But there's a catch: The homeowners have to agree to Airbnb a room in their home for anywhere from one to three years, and they have to give Loftium a majority of the proceeds.

"It makes a lot of sense," Elly said. "If we want to not give all of our savings away for a down payment and we want to save some for a safety net, they can fill the gap and allow us to do that."

Loftium co-founders Adam Stelle and Yifan Zhang launched the company last fall. In the first three months, they signed 1,500 homebuyers in the Seattle area. But with rising home prices, they realized Seattle proper may still be out of grasp for prospective customers.

"A lot of the homes are in jumbo loan territory," said Stelle. "They've become so expensive that even with a down payment you might not be able to qualify for a mortgage for a $650,000 house. We have a lot of buyers who are more middle income and they've been looking in the outskirts of Seattle and limited by that constraint."

That's why they're expanding, offering their down payment deal to the greater metropolitan area.

"By spreading it even further we're really excited to show that Loftium is not just for expensive tourism-heavy cities like Seattle," said Zhang. "It really works no matter where you are."

Like most Loftium customers, the Irbys are first-time homebuyers. They had three percent to put down. Loftium ponied up another two, giving them a five percent down payment on a $600,000 townhome in the Central District.

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"It was about a week and a half from seeing a home to them accepting their offer," Elly said.

They admit luck and Loftium paved the way to home ownership. They just have to rent their mother-in-law on Airbnb for a year.

Loftium breaks down how the deal works here.