Goverment grants for down payment assistance

[ton1523]

i always hear about all these companys that offer grants for down payment assistance. Which ones are actually legit? im sure if you could find a legit grant you would be able to qualify allot more customers because of the down payment assistance.

[Erik]

Grants offered by local municipalities are legit - you can call their office and get details on borrower/property/location eligibility. Government grants are different than down payment assistance offered by non-profit organizations. For a list of companies still approved by FHA you can try HUD's website.

[vino]

Hai,

I am Vino. I am Newbie to here.

Texas Down Payment Assistance
The American Dream Down Payment Act is a down payment assistance initiative that allows grants to be given to participating jurisdictions to assist low-to-mid-income families and uniformed employees such as, policemen, firemen, sanitation, maintenance workers, and teachers who are employees of the participating state to achieve homeownership.

Grants made available under this initiative may be used only for down payment assistance toward the purchase of single family housing by eligible families. The allocation formula for the grant amounts are done by considering the state of Texas or the participating jurisdiction's prior year's commitment to assistance to homebuyers, the formula shall consider amounts committed to such purpose under the home investment partnerships program, the community development block grant program, mortgage revenue bonds, and prior year's funding from State and local governments, provided that the data underlying such funding is uniform, verifiable, and accurate by the State and local government, and shall consider other factors that the Secretary determines to be appropriate.

[Greg]

Genesis

Ok I will elaborate.

These companies get funds from investors to use. They charge a processing fee to fund the non-profit. Usually 300-400 or as high as 1% in some cases. They wire the money to title at closing then take it back. it is a paper transaction and the seller is conceeding that money since they take it back. You can conceed 3% for down payment assistance plus 6% for seller concessions.

See FHA 101 for more information

Fha 101

[Greg]

I thought I would update this one.

10/1/2007 Legislation passed banning the use of downpayment assistance companies who charge a fee or are seller funded. View it here.

10/1/2007 HUD was sued by all those companies and an injunction is pending.

As of now the deadline for honoring these transactions is purchase contracts dated no later than 10/31/2007

Expanding American Homeownership Act of 2007 passed in the house but still is undergoing modifications. Right now it is going to be 1.5% down required but it is still one of the most heavily debated items due to cancellation of seller paid dpa/fee based dpa. Loan limits should increase and mortgage insurance will become tiered based on credit.

So let's seek alternatives. Anyone know any??