So you want to buy a house and you have little or no money for a down payment!
You ask a relative for support and you get little in the way as a positive response.
What options are you left with?
Well for the savvy homebuyer you know that you are limited when it comes to 100% Financing knowing the closest option is 97% through FHA.
Side bar, I know there are other complicated, detailed and those loans that tease you with 100% financing but I am NOT going into detail on those because in my opinion those loans are SO difficult to close I will leave it up to someone else to be that expert and focus in on FHA financing and where we are headed.
I am back to business.
So if you have limited down payment and need more where do you turn?
Luckily you can find a “Down Payment Assistance Program for FHA Loans.”
There are several different programs out there but they all have one thing in common:
THEY ARE ABOUT TO BE ELIMINATED BY
THE NEW HOUSING BILL OF 2008!
I often wonder what officials are thinking when they put something like this into effect but honestly that is a topic I don’t care to discuss here or for that fact ever. I just try to remain focused on the outcome and what we need to do to move forward.
Personally I use Down Payment Assistance Programs for FHA Loans and my clients quite often. The Program I use is called Nehemiah and can be found at www.getdownpayment.com WAIT before you leave here for there you will still need to know a few things.
To use this program you will be facing some real issues getting offers accepted by home sellers but good news is that you will get the 100% financing you are looking for.
Now if this law truly remains as is we will see this program TERMINATED on October 1st 2008 so start looking soon if you plan on using this program but be prepared for a true test of desire because again, Sellers want little to do with this program.
How it works, when you write a contract you ask the seller to contribute 6% of the sales price to the Down Payment Assistance Program for FHA Loans. IF the seller agrees they pass 6% of the sales price to the Down Payment Assistance Program for FHA Loans and a small fee is collected by the program which in turn sends in the 6% back to escrow as a gift to the buyer.
Logistically speaking, the Down Payment Assistance Program for FHA Loans typically sends the money ahead of funding of the transaction and escrow coordinates the delivery of the funds and fees.
Now the real question here is “What will happen when Down Payment Assistance Programs for FHA Loans go away?” NOT forgetting the new changes around Buy and Bail!
I think these two things will REALLY impact the Real Estate Market across the board and it will be interesting moving forward.
As always I am here to help! You can find more topics at my BLOGS www.brentlane.wordpress.com and www.thelanegroup.blogspot.com
Brent Lane
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Hi Brent,
Interesting enough as soon as the H.R. 3221 was signed by President Bush a new bill H.R. 6994 was proposed to bring back down payment assistance. This new bill will reform the structure of down payment assistance. Basically, it will look at the risk of the borrower based on credit score. Personally, I think the down payment assistance through the FHA is a good thing. It brings buyers into the market that might not be able to squirrel away $10,000 for down payment. Unfortunately, this down payment assistance was viewed by many in Congress as a reason for the current housing downturn. Maybe it was the interest only 2/28 ARMs that were provided to did not have to document there income?? Whatever the cause I hope down payment assistance for FHA loans is repealed with the new bill.
I was really appalled to hear about HR 3221 and the ramifications it holds. I do not believe these assistance programs were the cause of the current real estate market, or lack of it. I do not assume to know the intricacies of the mortgage business. What I DO KNOW is that thousands of families would have been eliminated from owning a home if it weren’t for the DPA programs including myself. I am about to close on my first home and will be eternally grateful for their assistance.
This was the biggest mistake of this legislative session which we all know has had many a blunders. I think the DPA programs will have to be brought back to get us out of this mess. I do think they need to be revamped and based more on credit worthiness. Even though the rates of default are much higher for those that implement this program it still allowed for many deserving families to get that foot in the door.
They better expand governmental down payment assistance programs or redesign these program to allow acceptance of them based on credit worthiness of the buyer or they will have put lower class working families further behind the 8 ball.
Hey,I think the DPA programs will have to be brought back to get us out of this mess. I do think they need to be revamped and based more on credit worthiness.
Can you still find down payments programs now that it is after october 2008. hmm
I don’t think realtors know enought about FHA to present it properly. I am an advocate of it and it has made my real estate job much easier. Many people have the “hold your cash” mentality so a lot are comfortable with 3% down and higher closing costs.
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Scared of being turned down by the lenders due to low credit ratings? Scared of losing your home ownership dream? Want a way out of it? Let us guide you all the way to a perfect home with FHA home loan plans.
Their skies to my acquaintance this exactly large help will be.
I think he tries it.
Hi! I was surfing and found your blog post… nice! I love your blog.
Cheers! Sandra. R.
It has been my experience that you not ask a family or friend. Things can get turned over and before you know it everything is in upheaval.
Career Placement Test´s last blog ..How To Pass The Test
Because of bad policies and other circumstances, including foreclosures, prices of homes have been falling lately. But what might be even worse than bad policies is the use large banks are making of their leeway in matter of credit management. Instead of loans, they are investing in buying their competitors, failing or not.
This is not the best of environments for real estate prosperity.
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