OK - so the FHA does not like down payment programs like Nehemiah or Ameridream because the default rates on these loans is higher than a homebuyer who makes a down payment. But, they do serve a purpose in helping folks with their dreams of home ownership. Let's not forget that with a FHA loan you must qualify full documentation under pretty rigid guidelines - so with that being said - the DAP's are going away as of October 1.
So if you have been on the sidelines regarding a purchase and you need down payment assistance from the seller -then you need to act now. Because after Oct 1 - you will need 3.5% as a down payment and on a 200K purchase, that would be $7000.
There is some pending legislation to allow the DAP's, but as of right now - the deadline is Oct 1.
Also, don't forget when purchasing a home to use this formula - you can normally purchase 3-4 times your total household income - your other debt influences that number.
Rich
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Rich
I wanted to just share that I read they have submitted a new bill. I got this right off the GetDownPayment.com website for the Nehemiah Program.
H.R. 6694
A bill introduced by Representatives Maxine Waters, Gary Miller, Al Green and Christopher Shays on July 31, 2008, that would reinstate SF-DPA. If passed and signed into law, the FHA Seller-Financed Downpayment Reform and Risk-Based Pricing Authorization Act of 2008 (H.R. 6694) will allow downpayment assistance to continue indefinitely.
If you want to send your support you can through this website, it was easy and fast. All you do is Click this link and it will take you to the page to send a letter. It takes 2 seconds it has pre-written paragraphs that you can pick easily to express your view on it. (leave out the ones that don't apply) and when you fill out your contact info with address and zip it automatically sends to your representatives.
http://capwiz.com/nehemia/issues/alert/?alertid=11709431
I hope we can get enough supports to pass this new bill.
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