Down Payment Assistance Update
If you were hoping to take advantage of Seller Funded Down Payment Assistance (DPA) you better do it before October 1, which is when that particular form of DPA will be banished. In 2007, the default rate on these types of FHA loans was more than a quarter higher than on other types of loans. It makes sense when you think about it, when buyers use someone else’s money to help fund their homes they don’t have much of their own “skin in the game.” (Dick Armey, former House Majority Leader, is famous for saying something to the effect that criminals, children, and politicians spend other people’s money and therefore need to be watched carefully. I think this could also be applied to Seller DPA.)
Note however, that you can still get DPA from family members, charities and other government programs after October 1. You can also still get a 100% loan from FHA but you’ll need to cough up 3.5% to help cover either closing costs or the down payment.
Beth Skinner is a real estate professional who actually returns phone calls and emails! Click here to search the MLS for your dream home.
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