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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FHA, VA, Rural Development, Reverse Mortgages, Construction Permanent, Renovation,
FHA Renovation, Mortgage Modification and Loss Mitigation
Mortgage lending offices located in Chattanooga, TN
rsmith@aamonline.com
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Richard Smith Conventional, FHA, FHA 203k, HUD $100 down purchases, VA, Jumbo VA, Rural Development, Jumbo, FannieMae Homepath, Home Equity Line of Credit (HELOC). |
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This blog represents the opinions of Richard Smith. The posts and comments written on the blog do not represent the opinions or positions of Stearns Lending, Inc. |
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