With homebuying becoming increasingly unaffordable, Zillow Home Loans is rolling out a new program. 

The new program that Zillow is trying out requires a surprisingly low down payment of only 1%. Zillow Home Loans will pay an additional 2% in closing costs, bringing the total amount to 3%. 

Although the program is only available to Arizona buyers, Zillow plans to expand the offer based on the trial program's success. The offer is only for first-time home buyers with a FICO score of at least 620 and income below 80% of the median income at the property's location. Borrowers must complete an education course on homeownership and intend to occupy the property as the primary single-family residence.

Zillow will help lower the barrier to homeownership by assisting with down payment costs. According to Orphe Divounguy, Zillow Home Loans' senior macroeconomist, this will help people who haven't been able to save up for a down payment but can afford higher rent payments. The program Zillow to build additional revenue streams aside for home listings. 

"The rapid rise in rents and home values means many renters who are already paying high monthly housing costs may not have enough saved up for a large down payment, and these types of programs are welcome innovations in lowering the potential barriers to homeownership for those who qualify," says Divounguy.