Anyone in the market for a new home may want to wait just a little bit. There are rumblings in Congress for FHA to re-implement their down payment assistance program. Without it, sales are going to plummet insofar as FHA now requires between a 3% to 5% down payment plus PMI. In this economy, most people don't have that money laying around. Thus, wait a few weeks and see how this shakes out.
Wow, interesting to read this! I'm currently looking for a possible condo and the down is (plus a little credit issue) are the main things holding me back right now... Thank You!!!
FHA is not going to lower the minimum down payment. 2.25% is the current minimum and most can get away with 0% down with a gift of equity. Interest rates are at 5.25 PAR on a 30 year fixed currently and the probability of interest rates improving past this level are slim. Market prices are extremely low due to the unavailability of financing. The best time to buy is now. Houses will continue to price lower due to the mortgage crisis for another 18 months. Once mortgage financing loosens up and guidelines are less restrictive, then home prices will begin to increase. Today is the perfect buying opportunity for home owners and investors.
something to hope for, i was just about ready to be able to buy using fha, but can't without the dpa. where would i be able to track the rumblings? Edit: Nevermind, I found a website that let me contact my elected officials regarding h.r. 6694
Eh, there is already a resolution on the floor so I'd say there is a definatively a possibility that down payment assistance comes back.
A different route... Im currently looking to purchase a home and have run into roadblocks as well - lenders are scared to loan right now unless you are a "perfect" borrower: 20% down, 750 FICO , etc. My agent told me about a program that bypasses all that...its called NACA and has been around for 15 or more years, helping people get loans. She actually bought her first home via this program. The program is an attempt to get people out of the cycle of sub-prime borrowing and make homeowners, through home ownership, better stewards of their neighborhoods. Once you sign up they take you through the buying process step by step. You don't need a down payment and you don't pay PMI. Furthermore, they pay no attention whatsoever to your FICO score - you could have zero or 850 and you will still get the same good rates. The only thing is that you have to show you can afford the home and that you have resolved most of your credit issues. The application fees are greatly reduced, the interest rate is about 1% less than the going market rate. If you have credit issues they assist you with clean up until you are in a position to start your housing search. Some people are ready to purchase in a few weeks, others take a few months before they are ready to buy - it depends on your situation. The loans are backed by BOA as a "giving back" to communities. There are caps on income and the price of home you can buy but they are pretty high. And you actually have to live in the home - no rental no investment deals. Plus, they have a Home Save program that helps people facing foreclosure, getting them a better rate and keeping them in their homes. The process starts when attend an informational seminar. After that you begin working one on one with a counselor who guides you through the process and gets you where you need to begin as far as pulling together docs and getting ready to apply. The counselors are all volunteers who have been through the program themselves. The first person testimonials are inspiring because this is a program that really works. One guy bought last year and his int. rate is 2.75% fixed/30 yrs. He was able to get that rate by "buying down" the rate via seller incentives. He got a brand new home, upgrades, etc. at 2.75% - no down payment, no PMI. I hope that with the help of NACA I will be in a home by Christmas. You should check it out.
hehe NACA - for their max purchase in my neighborhood you could buy a box Max purchase price listed for Greenwich CT and Westchester County NY is around 350 k for a single family house, last time that was entry level was around the year 1920. Guess this is a good program for living in New Orleans or Galveston, TX.
I've never heard of it but, the parameters for FHA are still 690 to 700 will get you a 6.00 APR on a 30 yr fixed with at least 3.25% down.
