Down Payment Assistance, DPA, should it stay or should it go? DPA is a program that has been used by buyers to purchase homes with no money down It comes in a variety of ways, Ameridream and Nehemiah are a couple of the big ones. Basically it was a program where the seller would contribute part of the purchase price (up to 6%) to the down payment of the buyer. With the new legislation that Congress passed this program was done away with effectively as of October 1st. There is currently legislation not yet passed to have this program reinstated. So I ask, should it stay or should it go? Personally I believe that when a person does not have a vested interest in a home that person is less likely to try and keep the home. That is, “I have nothing to lose (read money) by letting the bank have it back. Yes I understand it will negatively effect my credit however I can just get another loan later or rent for awhile” Isn’t this how we got in this mess in the first place? No accountability for our actions, the infamous “It’s not my fault” defense. Now don’t think that I don’t believe in helping someone get in a home that wants to be in one. I am a realtor after all. However there is currently a program in place in Idaho that helps homeowners buy a home, with little or no money down, which does not have mortgage insurance added on to it and here is the biggie is only semi based on credit. What did you say Rich? Already a program in place that does all we need that is semi based on credit? No Way! Yes there is reader. That program is an IHFA loan. It requires a look at credit however the credit scores are not the single factor in determining the loan. Your credit can be ok; it does not have to be fantastic. The mortgage insurance is included in the interest rate making the payment more affordable with lender paid PMI and there can be almost no down payment. The home I am currently working on is costing my buyer $500 dollars down. IHFA has a grant program in place that the buyer can use towards down payment and closing costs. Now there is a catch. It is intended for 1st time home buyers, or those who have not owned a home in the last three years. Unless you are buying a home in a targeted county; currently Canyon County is a targeted county as are Washington, Payette for a complete list please visit www.idamortgage.com website. The most common objection heard about the IHFA product is that there is recapture on the loan. While that is semi true the real truth is that IHFA will waive recapture if you ask. They will not waive recapture on a grant. They will forgive the grant at a rate of 20% per year. Let me repeat that! IHFA will waive the recapture on a loan and forgive the grant at 20% per year on the free money they just give you for taking a class and qualifying. Seems fair to me; wait there’s more, IHFA also limits what a lender is allowed charge you in fees as well. What not to like?
For more information please visit the IHFA web site at www.IHFA.org or call your favorite realtor and ask them if their lender has the IHFA program.
Tags: Boise real estate, first time home buyers, Foreclosure, housing prices, Hud Homes, Idaho Real Estate, Meridian real estate, rent or buy, Rich Nesbit, weather
