In the past year I have had three buyers getting FHA loans, use a down payment assistance program and I have been hearing for the past six months that it was on the chopping blocks!
Well today my mortgage broker called and told me they have been saved and will continue to be available to buyers. From what I understood, HUD's argument was that these loans had a better chance of default and were artificially inflating prices. I personally didn't think so! The reason I didn't think so was because if the house didn't appraise, you couldn't use it.
Now, my buyers who used the program had the 3% down for the down payment required by the FHA, but I thought it would be a better use of their money to save it as a rainy day fund incase they got in trouble. This would lesson any risk of having them go in to default on their home loans.
I understand the FHA and HUD's argument, but I think if they want to change the rules, make it so that people who do use down payment assistance have a reserve and make it a win-win for everyone involved. Most people live month to month and if they get in trouble they don't have anything to fall back on and this is a program that can help.
I understand wanting to have a higher PMI, if they use such a program, but we need to figure out a way to get lower income people and single parent households into the dream of home ownership, and these down payment assistance programs were great for doing just that!
So, thank you courts, for seeing the light and giving the down payment assistance programs a stay of execution.
Todd Clark - broker
Kastings & Associates
Phone: (503)524-9494
Fax: (503)622-8739
Todd Clark and the Friendly Home Team
Knipe Realty
Todd@IFoundYourNewHome.com
Phone: (503)524-9494
Fax: (503)746-9573
I am a licensed Realtor who specializes in Washington County, Oregon and also work in both Clackamas and Multnomah Counties including the cities of Aloha, Beaverton, Canby, Clackamas, Gladstone, Gresham, Happy Valley, Hillsboro, Milwaukie, Oregon City, Sherwood and Tigard. All information contained in these posts are copyrighted and cannot be used without prior written approval authorization from the author me Todd Clark. If you are looking for an outstanding agent please give me a call I would love to help you with all your real estate needs.
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Todd,
I love those programs that enable first time homebuyers to achieve the American Dream!!! Thanks, Fran
Todd:
Nice post and update on this situation. I heard from my mortgage broker that stated income is a thing of the past which will effect me and my home buying. Thanks for the comments on my blog.
Natalie - Real easy to make, I wrote a post about how you can make some yourself... They are pretty easy.
Anthony - Nehemiah and Ameridream. (Both which are gone now)
Bart - I actually got 4 more closes out of these programs before they went away again permanently.
Fran - These programs were much better than the tax credit and didn't involve my tax money!
Alan - So many home buyers will no longer be able to buy now, which is such a shame, they more than qualified, but just couldn't come up with the down paymens required.
Debbie - These programs were awesome and helped so many.
Judy - I think it was also, it is a shame the government didn't see the value in these programs.