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Established Member
receivingthepromise
Posts: 18
Registered: ‎07-23-2008

Re: The Official NACA mortgage thread


RichRaven wrote:

I wish you luck receivingthepromise my wife and I will start the program at the beginning of Jan. to hopefully complete it by Dec. 09. I have many questions and please feel free to answer no matter how long the explanation because this will help us in our quest. I've been to the website but I feel it's better to get advice from someone who's been through the program. Our credit is pretty good so we hope this will eliminate a lot of hassles in the beginning. My questions are:

1. How long does the entire process take? Not sure of the entire time. It depends on your exact situation i.e credit issues, budget issues, savings. My advice make sure that everything that has affected your credit in the past 24months have been paid or addressed and you have proof. If you plan to start in January setup a monthly budget now so you are aware of what you spend each month before you go in. If you are saving now keep it going have a pattern you can show. My consultant also advised finding an account with a good interest rate so you can gain good interest while you save.

2. Is it true that at closing certain monies you would normally be paying at closing will be used to buy down your interest rate? You still pay the same closing cost but money that you would use for a down payment can be used to buy down points. Also any funds that the seller donates can go toward buy down.

3.At what point do you start looking, and how long do you have to look once approved? You can only start looking once you become NACA Credit Approved. You go to a workshop on the Thursday after you are approved and get the letter showing you are approved and can start the search. The approval is good for 3 months if you are still searching in 3 months you have to get reapproved. This should be easy if you keep your consultant updated with paystubs and bank statements until you close, as they ask you to do.

4.Once you find your home can you negotiate with the seller to help buy down your interest rate? Yes, you can outright tell them its going toward your buy down or the can "pay" toward closing cost. You can also use downpayment assistance programs to buy down point too.

5. Finally can you give me a detailed overview of the process from beginning to end such as what happened at initial meeting with counselor to the point you're at now in the process? First, about one week before Saturday workshop I received an email for home save people. This email will give you a link to start the sign up process and get your NACA ID#. It will also allow you to submit budget, bank, rental, employment information. You can also schedule your intake appointment (call the office to confirm that time slot is available some offices). The intake took about 2 hours. Even if you upload the documents to the website you still need to take the office hard copies so they can be uploaded in the computer. My advice is look at page 30 of the work book and bring a copy of everything requested. After the consultant uploads the paper work they will then go over your credit report. If you have any baddies -even paid off- they want you to provide a statement and proof. Don't have anything on your report that has not been paid or is on a payment plan with proof. All my baddies had been paid so there was no problems in he area. Next you will go over your budget. They are able to pull up the one you submit on the website. If you have any amounts that look to low the system will prompt the consultant to ask about it and enter your explanation. My advice here have proof for the amounts her if you have your own budget that you already go off tell the consultant; if its something like utilities provide bills that show the amount you pay each month. Then you will go over the amount of money you want to spend on your home. They will tell you the amount for different types of properties in your area, and the amount of MRF(minimum required funds) you will need for each. I had my consultant give me the information for properties from SFH to fourplex. Another small word of advice if you plan to use money from a 401k or retirement account  have the paper work showing the amount in the fund and how much you can take out; also need to show that this will not be a loan that has to be paid back. I have learned now that if you make any deposits that are not from a payroll check have documentation show where these funds have come from such gifts or refunds. If you have all this paperwork when you go to your intake meeting you will be ready to be submitted to within 72 hours. The consultant has to get employment, and rental verification so if you have a fax number give it it will make the paper work go faster. Once you are submitted to the UW you wait for their response. What I have noticed is that the UW reviews accounts on Tuesdays so by Wednesday you should have an answer. I am at a point now where I just have to wait. I have submitted all the documents that the UW has ask for and will need to get me approved. Because the UW ask that I show two months bank statements with no payday loans I have to wait until November to resubmit. Each payday I scan and upload a copy of my paystub not only to NACA website but also to my consultant. Just send him an update email. Also any updated bank statements I get. My consultant has been okay with communicating back to me and answering any questions I may have. I did let him know during my intake meeting that I had no problem calling and emailing if/when I have questions. The process is not easy and can be very trying you just have to focus and commit yourself. I have found out by reading on the internet (Google search for NACA mortgage) that before you close they expect you to have completed some "participation actives" before you can close on your loan. I think I will take to my consultant about that and find out what they will need me to do.  

I know this is a lot to ask but we're committed to the program and I know your experiences will help us tremendously. We need all the help we can get so please all chime in.


 

Regular Contributor
RichRaven
Posts: 239
Registered: ‎08-30-2007
0

Re: The Official NACA mortgage thread

Thank you so much. That was very informative. Anyone that has interest in this program should read your comments. Wow.

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Regular Contributor
RichRaven
Posts: 239
Registered: ‎08-30-2007
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Re: The Official NACA mortgage thread

bump

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Contributor
brighterday
Posts: 97
Registered: ‎09-17-2008
0

Re: The Official NACA mortgage thread

I attended a purchase workshop in Atlanta on 9/14. My intake appointment is tomorrow afternoon.  I will update the thread over the weekend with the info I receive tomorrow.
Contributor
shawtycat
Posts: 91
Registered: ‎03-08-2007
0

Re: The Official NACA mortgage thread

Went to a workshop on 9/27/08 but decided to just wait.  1.  Don't think they have any services offered for PA where I plan on buying and 2. Couldn't get an answer about lien removal after you pay off your home. 

 

I understand having to live in your home for 3 years or pay the $25k penalty (workshop guy said this) and having the lien on the mortgage for NACA as well as the lender.  My thing is why, after payoff of the mortgage where the lender will remove the lien and sign the home over to you, does NACA still have a lien?  Was told that it had to do with some program where they help you make payments if you ever get into trouble. 

 

I don't know, maybe the guy was new and confused?  If the mortgage is paid off the house should be yours fair and square.  No one should have a lien on it unless you defaulted on a big bill and they got a judgement.  So...I don't understand and am not willing to take the chance of a permanent lien on our home.  Maybe someone can get clarification if the situation I was told about is inaccurate.  Until then, I am going through FHA when we have our savings and self-employment tax returns in order in 24 months.

 

Atleast they gave me some good ideas and guidelines at the workshop.  :smileyhappy:  I did not come away empty handed.

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Jodi
Established Member
bellagemma
Posts: 23
Registered: ‎08-19-2008
0

Re: The Official NACA mortgage thread

I went to a workshop and didn't hear anything about a $25k penalty if you didn't live in the house for three years. I'll need to ask about this if I decide to pursue this.
Valued Member
bunny44
Posts: 47
Registered: ‎10-02-2007
0

Re: The Official NACA mortgage thread

I was told that the lien is only to prevent people from taking out second mortgages etc.  You can refinance the mortgage at any time and get out from under any NACA requirements.  If you sell your home, any profit is yours.  The only time the lien is an issue is if you take out money out of the home.  I guess NACA figures that it is risky and people may over-extend themself which is the opposite of what NACA is trying to do.  I did not hear anything about the three year rule.

 

 

Contributor
shawtycat
Posts: 91
Registered: ‎03-08-2007
0

Re: The Official NACA mortgage thread

I know they have an owner occupied restriction.  The workshop guy clarified it to be 3 yrs occupancy in the home you purchased which is what NACA is all about....home ownership.  You can't turn it into an investment property.

 

As for the lien, my fiance straightened that out.  The lien is taken off after the mortgage is paid in full or you refinance, but will stay on if you had financial trouble and had to use the Post Purchase benefits to make payments.  The lien stays until you pay NACA back.

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Contributor
brighterday
Posts: 97
Registered: ‎09-17-2008
0

Re: The Official NACA mortgage thread

[ Edited ]
I think receivingthepromise provided a great explanation of how the purchase program works. I've added some additional info to receivings post (in red) based on the info I received during my intake appt. I hope it helps.

receivingthepromise wrote:

RichRaven wrote:

I wish you luck receivingthepromise my wife and I will start the program at the beginning of Jan. to hopefully complete it by Dec. 09. I have many questions and please feel free to answer no matter how long the explanation because this will help us in our quest. I've been to the website but I feel it's better to get advice from someone who's been through the program. Our credit is pretty good so we hope this will eliminate a lot of hassles in the beginning. My questions are:

1. How long does the entire process take? Not sure of the entire time. It depends on your exact situation i.e credit issues, budget issues, savings. My advice make sure that everything that has affected your credit in the past 24months have been paid or addressed and you have proof (i.e. cancelled checks, dispute letters, letters of explanation, etc.). If you plan to start in January setup a monthly budget now so you are aware of what you spend each month before you go in. If you are saving now keep it going have a pattern you can show. My consultant also advised finding an account with a good interest rate so you can gain good interest while you save.

2. Is it true that at closing certain monies you would normally be paying at closing will be used to buy down your interest rate? You still pay the same closing cost but money that you would use for a down payment can be used to buy down points. Also any funds that the seller donates can go toward buy down. NACA states that you do not pay closing costs. You are required to provide proof of funds before being approved (see below), but they are not for typical closing costs: appraisal fee, down payment, origination fee, document fees, title insurance, PMI (if DP is <20%, etc. My understanding is that those fees are paid by the lender. NACA's term for the money required for loan approval is minimum required funds (MRF) and for the purchase of a single family home that includes: earnest money, home inspection fee, homeowners insurance for one year, escrowed real estate taxes (3 months), pre-paid mortgage interest, and mortgages reserves. Mortgage reserves will be 1-2 times your monthly mortgage payment and is determined by your payment shock. Payment shock = PITI - your current rent. If payment shock is less than $300, one month of reserves is required. If payment shock is greater than $300, two months of reserves are required. Your payment shock will also determine the type of savings pattern you have to demonstrate. Assuming your current net income is greater than your expenses (as documented by your budget), the smaller your payment shock the shorter amount of time you will have to demonstrate the savings pattern. Example: $600 payment shock may require proof that you can/or have been saving $600/ month for 4-6+ months, while $100 payment shock may only require 1-2 months savings pattern. You will also need the money, if any, that you plan on using to buy down your interest rate. That money can come from your savings, a gift, downpayment assistance programs (be sure to verify with your counselor which programs are compatible) or the seller/builder. The buydown rate is .25% for every 1% of the purchase price contributed.

3.At what point do you start looking, and how long do you have to look once approved? You can only start looking once you become NACA Credit Approved. You go to a workshop on the Thursday after you are approved and get the letter showing you are approved and can start the search. The approval is good for 3 months if you are still searching in 3 months you have to get reapproved. This should be easy if you keep your consultant updated with paystubs and bank statements until you close, as they ask you to do.

4.Once you find your home can you negotiate with the seller to help buy down your interest rate? Yes, you can outright tell them its going toward your buy down or the can "pay" toward closing cost. You can also use downpayment assistance programs to buy down point too.

5. Finally can you give me a detailed overview of the process from beginning to end such as what happened at initial meeting with counselor to the point you're at now in the process? First, about one week before Saturday workshop I received an email for home save people. This email will give you a link to start the sign up process and get your NACA ID#. It will also allow you to submit budget, bank, rental, employment information. You can also schedule your intake appointment (call the office to confirm that time slot is available some offices). The intake took about 2 hours. Even if you upload the documents to the website you still need to take the office hard copies so they can be uploaded in the computer. My advice is look at page 30 of the work book and bring a copy of everything requested. After the consultant uploads the paper work they will then go over your credit report. If you have any baddies -even paid off- they want you to provide a statement and proof (if they occured within the last 24 months). Don't have anything on your report that has not been paid or is on a payment plan with proof. All my baddies had been paid so there was no problems in he area. Next you will go over your budget. They are able to pull up the one you submit on the website. If you have any amounts that look to low the system will prompt the consultant to ask about it and enter your explanation. My advice here have proof for the amounts her if you have your own budget that you already go off tell the consultant; if its something like utilities provide bills that show the amount you pay each month. Then you will go over the amount of money you want to spend on your home. They will tell you the amount for different types of properties in your area, and the amount of MRF(minimum required funds) you will need for each. I had my consultant give me the information for properties from SFH to fourplex. Another small word of advice if you plan to use money from a 401k or retirement account have the paper work showing the amount in the fund and how much you can take out; also need to show that this will not be a loan that has to be paid back. I have learned now that if you make any deposits that are not from a payroll check have documentation show where these funds have come from such gifts or refunds. If you have all this paperwork when you go to your intake meeting you will be ready to be submitted to within 72 hours. The consultant has to get employment, and rental verification so if you have a fax number give it it will make the paper work go faster. Once you are submitted to the UW you wait for their response. What I have noticed is that the UW reviews accounts on Tuesdays so by Wednesday you should have an answer. I am at a point now where I just have to wait. I have submitted all the documents that the UW has ask for and will need to get me approved. Because the UW ask that I show two months bank statements with no payday loans I have to wait until November to resubmit. Each payday I scan and upload a copy of my paystub not only to NACA website but also to my consultant. Just send him an update email. Also any updated bank statements I get. My consultant has been okay with communicating back to me and answering any questions I may have. I did let him know during my intake meeting that I had no problem calling and emailing if/when I have questions. The process is not easy and can be very trying you just have to focus and commit yourself. I have found out by reading on the internet (Google search for NACA mortgage) that before you close they expect you to have completed some "participation actives" before you can close on your loan. I think I will take to my consultant about that and find out what they will need me to do.

I know this is a lot to ask but we're committed to the program and I know your experiences will help us tremendously. We need all the help we can get so please all chime in.


 


Message Edited by brighterday on 10-12-2008 09:26 AM
Message Edited by brighterday on 10-12-2008 09:28 AM
Valued Member
SingleWithThree
Posts: 45
Registered: ‎06-08-2008
0

NACA and Wage Garnishment ?

For anyone that knows about NACA, could someone please help me...

 

To make a long story short I was on my way to purchasing a home last Spring.  Got preapproved, offer accepted and all.  But right before closing a student loan that I had no knowledge of (sounds crazy, but actually true) popped up on my credit.  We had to stop the home buying process and I was trying to figure out how to come up with the funds to buy the home when my fiancee left.  So I ended up with a wage garnishment.  I didn't fight it because I just want it paid and over with.

 

So, I just heard about NACA and I am scheduled to attend the workshop next month.  I am hopefully going to settle on the wage garnishment in a few weeks (creditor is waiting for more payments from the court first - takes forever) and then they will accept the offer on the settlement. 

 

My question is...will they still work with me even with this garnishment appearing on my pay stub?  I'm assuming that they will since that is the point of the whole program, but I was curious if anyone ever had experiences with this. 

 

AND...since I'm asking...what are their requirements in regards to collections being paid off?  Do they make you pay everything off including medical?

 

THANKS in advance !!!!!


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