Down Payment Assistance - gift / FHA

[Anonymous]

Hi,

I have a question about down payment assistance. I am reading that September of last year congress took away some form of DPA - however I am reading here and there that you can still get it from charity or grants. Im looking for help because I have less than a month to find one, Im pretty sure we will qualify for it, I just have to find it.

Our city has a down payment assistance program for the first lender, called FirstHOME -which is basically a HUD program tied with FHA. We put in our preliminary application and found out last night we were chosen to receive it.

Thing is... by December 15th we have to show pre-qualification (fingers crossed) and also show proof that the 2% we must provide is not from going into debt. I.e. we cant take a loan to get the 2%, if we dont raise it ourselves it must be a gift.

Barring any help from family - which in this economy feels unlikely - our only other option is to find a charity.

I have absolutely no idea where to look. I have scoured the HUD website and I keep seeing it mentioned but no links.

The booklet we have from them, says "The borrower must contribute an amount of at least 2% of the sale price of the home. The 2% may be gift funds or a grant from another agency, but cannot represent debt, such as a personal loan, bank loan, credit card debt, or any other funds which must be repaid at any time. The funds must be accessible at the time of eligibility determination (i.e. cannot be dependent on the sale of real property or other non-monetary assets). Proof of the borrower contribution (bank statements, written commitments from gift-giver, pre-approval of grant funds) will be required."

If anyone knows where I can look, where to find these that FHA will approve, etc. I would be extremely appreciative.

[Anonymous]

For that type of thing you are going to have to look locally.  For the most part, anyone giving out any kind of home assistance nationally is focusing on preventing foreclosures, not helping buyers.  If there are no local programs I have no clue as to where to go.  The other issue is that if you have no money involved, I am assuming you also have no reserves.  Most of these programs will want to see a little reserves.  Underwriters get antsy when someone is using none of their own money unless the rest of their file is fairly strong.

[Anonymous]

I have no idea how to search for it locally - but the FirstHOME thing is giving 50% downpayment to the first lender so they are not concerned with the reserves thing. Normally we wouldnt even have to come up with any down payment due to VA, but its the FirstHOME program that wants the 2% - and they are the ones telling us the 2% is okay to get from a grant/charity.

Its just finding one.

[Anonymous]

You have to just put the legwork in and start researching.  You may get lucky if someone here lives close to you, but that is way too specific of a question/issue and will most likely need to be addressed either by you through research, or through a local company.  Ask the program that is requiring it whether or not they have any leads. 

[DallasLoanGuy]

You don't have an asset to sell that would get you the 2%.....?!?!?!?

 for a 50% down payment from firsthome i would sell everything not nailed down. geez... you can buy it back.

dont let this deal get away.

[Anonymous]

2% cant be based off of a sale

[DallasLoanGuy]

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@Anonymous wrote:
2% cant be based off of a sale

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they wont let you sell an asset?

almost all programs will let you do that.

[Anonymous]

No - because sale would become assets counted directly as income which would raise our income to beyond the qualification limits. Also the money has to be readily available, when with a pending sale, its not.

[Anonymous]

I think Dallas is talking about the little stuff around the house you could sell quickly (garage sale/craigslist) and get some cash quick.  I doubt that they have a way to track whether or not  a TV is an asset or th eold bike in the garage was.    As long as you did it quickly, the cash would be available.  I don't thin he was referring to cars, property, etc that are probably counted as assets on paperwork.

[Anonymous]

ah - well we dont have anything that would accrue that unfortunately except for the car.