Down Payment Assistance Getting CPR
While lying on it’s death bed it appears as though Seller Funded Down Payment Assistance may well be getting a reprieve. As many of you know, the Housing Stimulous Act of 2008 did away with Seller Funded DPA. Representative Al Greene (D-TX) has introduce H.R.6694 in the House of Representatives. This bill provides for the continuation of Seller Funded Down Payment Assistance by revising the requirements for seller funded down payments for mortgages for single-family housing insured by the Secretary of Housing and Urban Development under title II of the National Housing Act.
Financial Services Committee Chairman Supports Bill
Chairman of the House Financial Services Committee, Barney Frank (D-MA), has discussed openly that he has negotiated an agreement with HUD Secretary Preston that will provide for the continuation of seller funded down payment assistance and has virtually guaranteed that it will pass the house. The agreement allows HUD to impose risk-based pricing on down payment assistance transactions which provides Secretary Preston the fiscal protection he desired for the FHA insurance fund.
No Companion Bill In The Senate
Currently there is no companion bill to H.R.6694 in the senate even though Senators are well aware that this bill exists in the house. Over the past several weeks I have communicated with Senator Johnny Isakson (R-GA) via email of my concerns of this avenue for buyer’s being done away with. In an email from Senator Isakson dated 9-8-2008 he states “H.R.6694 is currently being considered by the House Committee on Financial Services and at this time there is not a companion bill in the Senate. Rest assured I will keep your thoughts in mind when this legislation comes before me on the Senate floor.” This morning I sent Senator Isakson another communication suggesting that he introduce the companion bill into the senate for consideration.
Get The Ball Rolling
By at least getting the ball rolling perhaps this valuable program will not be lost. Buyer’s nationwide stand to loose this option effective October 1, 2008 if H.R.6694 and the companion bill, which current doesn’t exist, in the Senate do not go into law. For anyone concerned with this important legislation get in touch with your Senators and Representatives to let them know how you feel.
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4 Responses to “ Down Payment Assistance Getting CPR ”
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Mack,
Your comments are right on. Down payment assistance has played a very important role in increasing home ownership in the U.S. and, as long as home values are increasing, which will happen again, there’s not much risk to the FHA as everyone thinks there is.
You’re right that the ball will be in the Senate’s court. We the people need to contact our senators and tell them “vote for HR 6694!” If enough of us write, call, and e-mail, they will listen. This is a helpful website: http://www.supporthomeownership.com
Nehemiah is nonsense, This industry never fails to live down to its poor public image for ethics.
There is no gift. It’s just 100% financing, It’s time for the industry to straighten up its act.
@ Harry Thanks for stopping by. I must however disagree with you about Nehemiah. Properly utilized, I think seller funded downpayment assistance is a valuable option for some buyer’s. Like every program it’s not for everyone.
I fail to see how you can make the statement that the industry has a poor public image for ethics when in reality this program helps approximately 300,000 buyers annually. Personally I have been using the Nehemiah Program for over 9 years for some of my buyers and have yet to have an adverse effect from it. I will agree with you that in essence it is a 100% financing program, however the buyer only has to repay 97% of it and that will soon be changing to 96.5% with the new 3.5% minimum downpayment on FHA Loans.