With all the misspent funds for the $700 billion Bucks for Banks program now well underway, we are still left with millions in home inventory and millions of prospective home owners unable to buy because of a lack of down payment.
Congress will meet next week and look at economic stimulus. The approach will be to spend more money.
If housing is at the center of the problem, it is time to take another look at proven programs that do not use the US Treaury.
Restore 100% conventional programs - My Community, FNMA Flex, Freddie 100, Home Possible, Community Reinvestment Act programs. I have not seen the delinquency figures for these programs. My guess is that the assumption is being made that delinquency is high for these low down payment loans, but that actual statistics do not support the assumption.
Restore FHA seller funded down payment assistance - This program has helped millions. Delinquency has not been unmanageable for these home owners, and can be improved simply by the guidelines similar to what is proposed in HR 6694.
Restore FHA loan amount calculation to 97.75% - Effective January 1 the FHA down payment will be increased to 3.5% and will no longer allow for a portion of buyer closing costs to offset some of the funds required for closing. This makes no sense, if the goal is to build up our housing market.
These three steps would make a great impact helping qualified families purchase homes, and would go a long way to stabilizing our housing market.
Ameridream video - Truth about down payment assistance.
Richard Smith
American Acceptance Mortgage, Inc
Toll Free 888-474-9920 Cell 423-280-0345
Home financing in Tennessee, Georgia, and Alabama.
Experience matters when it is your home loan.
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Mortgage lending offices located in Chattanooga, TN
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Excellent information, as usual, Richard. I agree, all of these programs would help our current situation, especially the DPAs.
Agreed Richard I never understood how removing seller funded DPA was going to help strengthen the housing market.
Richard, I am very glad to see your making note of this in your post. It is something that is the most abused onsumer scam out there and hundreds upon thousand of unsuspecting people are getting screwedd every singel day.
Good job
Bo
Thought you might want to know of a grassroots effort here in Tennessee to implement an Employer Assisted Housing PPO network for the entire state. We are starting in Cookeville, TN because that is where the Yes organization of TN office is located. Our efforts to educate the public has quickly let to training an entire realtor firm and mortgage company the first of Feb. We are meeting with TN house reps Jan. 29-30. and have Notified Tn Assoc. of Realtors-Nashville to inform and educate about our community EAH PPO Community Cooperative program. It is community supported and benefits the community as a whole. You may email me at christa.durfee@mygenerationusa.org or call me at 931.520.6336 to find out more information and how you can be a participating provider in your Tennessee community.
Representative Henry Fincher (D) of TN has completed the draft of House legislation to implement employer tax credits for participation in employer assisted housing. Rep. Fincher is a practicing attorney from Cookeville, TN. Fincher had a very short window of opportunity to research the federal legislation from 2007: Housing America's Workforce Act that outlines the benefits to communities, employers, and states that adopted the tax credits as a means of stabilizing and revitalizing housing markets. He reviewed similar legislation from others states like Massachusetts and Illinois before fashioning the TN version. Fincher will sponsor this in the TN House and work with Senate sponsors to further support both TN employers and rebuild the TN housing market. Economic Development experts hail this as a viable tool for economic growth in TN. Employers seeking an inviting home to place their companies place a great deal of consideration on state's that assist in homeownership programs. Fincher's work is truly a reflection of the Monday evening call for innovative solutions between government and the private sector by President Obama.