topic Re: Down Payment Assistance - gift / FHA in Mortgage Loans

Down Payment Assistance - gift / FHA

Anonymous — Wed, 18 Nov 2009 23:25:21 GMT

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.

Re: Down Payment Assistance - gift / FHA

Anonymous — Thu, 19 Nov 2009 00:35:56 GMT

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.

Re: Down Payment Assistance - gift / FHA

Anonymous — Thu, 19 Nov 2009 01:08:49 GMT

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.

Re: Down Payment Assistance - gift / FHA

Anonymous — Thu, 19 Nov 2009 02:53:25 GMT

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.

Re: Down Payment Assistance - gift / FHA

DallasLoanGuy — Thu, 19 Nov 2009 04:18:35 GMT

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.

Re: Down Payment Assistance - gift / FHA

Anonymous — Thu, 19 Nov 2009 04:25:00 GMT

2% cant be based off of a sale

Re: Down Payment Assistance - gift / FHA

DallasLoanGuy — Thu, 19 Nov 2009 04:33:40 GMT

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

they wont let you sell an asset?

almost all programs will let you do that.

Re: Down Payment Assistance - gift / FHA

Anonymous — Thu, 19 Nov 2009 05:42:26 GMT

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.

Re: Down Payment Assistance - gift / FHA

Anonymous — Thu, 19 Nov 2009 06:16:52 GMT

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.

Re: Down Payment Assistance - gift / FHA

Anonymous — Thu, 19 Nov 2009 21:46:20 GMT

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

Re: Down Payment Assistance - gift / FHA

DallasLoanGuy — Fri, 20 Nov 2009 04:09:40 GMT

I had a guy sell a roping horse for his down payment.....

U/W wanted to verify the value of the horse....

we got three local farmers to appraise the horse and attest to age of the horse.

we closed that loan. funniest **bleep** thing i ever seen

Re: Down Payment Assistance - gift / FHA

Anonymous — Fri, 20 Nov 2009 15:32:02 GMT

@Anonymous wrote:
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.

Why not call local/national banks who participate in the firsthome program to see if they know who to contact. Also many states get grants that are run by both city and county offices so while the firsthome grant is run through the city there could be programs your county offices run. There should also be a not for profit federal agency in your area to help you. Go to huds website and you can search for a office near you

Message Edited by steelfan on 11-20-2009 07:32 AM

Re: Down Payment Assistance - gift / FHA

Anonymous — Fri, 20 Nov 2009 16:23:05 GMT

Thanks I will try that, perhaps they do know. We are going through BofA.

As for the HUD site - Ive been on there left and right trying to find this information and I see it mentioned but never any links to one. So unless Im missing it over and over again...

Re: Down Payment Assistance - gift / FHA

Anonymous — Fri, 20 Nov 2009 16:39:40 GMT

judydyoung,

How much house are you buying? 2%? You would be surprised what you have arounfd the house that can get you a couple of Hundred dollars. How much do you have to come up with?

Re: Down Payment Assistance - gift / FHA

Anonymous — Fri, 20 Nov 2009 17:04:21 GMT

We need $5-6k

The average 3+2 where we live that even remotely meets HUD requirements is closer to the 300k mark.

Re: Down Payment Assistance - gift / FHA

Anonymous — Fri, 20 Nov 2009 17:16:03 GMT

judydyoung,

I'm in the Illinois. I have come up with over $30,000 in FTHB Grants. I am constantly scouring the web for others. If I go FHA I have to come up with 3.5% so I can use them to whittle off of my prinicple, help with closing or assist with down payment but None will absorb the 3.5%. I have to have that in the bank. I just don't know of any grant that will give you the required amount that you have to show. Like I said I have researched lot's of Grants!

Maybe someone will chime in with one.

Re: Down Payment Assistance - gift / FHA

Anonymous — Fri, 20 Nov 2009 17:20:59 GMT

@Anonymous wrote:
Thanks I will try that, perhaps they do know. We are going through BofA.

As for the HUD site - Ive been on there left and right trying to find this information and I see it mentioned but never any links to one. So unless Im missing it over and over again...

On the main page should be a "I want to talk to a housing counslor link" click that, when the new page opens up there will be a "state info" tab click that and choose your state. Once the new page opens up there will be another box saying I want to and pick talk to a housing coun. After youi click that a page should open up with names, addresses, phone numbers and weblinks to all couns in your state by alphabetical

Re: Down Payment Assistance - gift / FHA

Anonymous — Fri, 20 Nov 2009 19:14:52 GMT

They must be out there because otherwise they wouldnt tell us to look. Perhaps its due to location, we are in Los Angeles county. But Im trying to find down payment assistance programs that are not associated with FHA because I think the FHA ones are non existent now? Im confused as to what exactly they stopped last year.

Anyways I have heard of charities. I had originally found one place quickdown.com but they dont provide the money until near the end of everything, which the FirstHOME program doesnt accept.

Im looking for others.

Re: Down Payment Assistance - gift / FHA

Anonymous — Fri, 20 Nov 2009 19:16:04 GMT

Yes I know Ive seen those listings - however those are housing counselors not links to grant or charity sources.

Re: Down Payment Assistance - gift / FHA

Anonymous — Fri, 20 Nov 2009 19:22:04 GMT

from what I have seen, none of the charities will give you the money, even if you find one. They will onyl send the money directly to escrow immeidately before close. The risk of fraud is too great other wise.

I think the LO/program is more hinting at getting a gift for the 2% then finding a grant if YOU have to have cash in hand. Not to say it is an impossible task, but you will be hard pressed to find many charities doing this work right now and the ones that do are not likely to hand over money to the buyer, or to do so until immediately prior to close (as inthe day of closing they will wire money).

Good luck with it all.