Loan Assistance Programs Canceled in 2008
Elimination of Nonprofit Down Payment Assistance: On July 30, 2008, President Bush signed the Housing and Economic Recovery Act of 2008 which prohibits seller-funded DPA (Down Payment Assistance) for loans backed by the Federal Housing Administration. Prior to this bill, the seller could contribute up to 6% to the buyer to cover either a down payment or closing costs on an FHA loan. The changes took effect on Oct. 1, 2008. We provide this information for reference only. These grants are no longer available.
Newsong provides a down payment assistance program for residential and commercial properties. This program offers a one-time gift for all closing costs, and there are no income requirements or limits on who can participate. Anyone who qualifies for an FHA loan can apply to receive down payment help from Newsong. The program does not require inspections or credit checks, and there are no restrictions on where you wish to buy your home as long as it is within the "geographic United States". The program offers:
- No "first-time homebuyer" restrictions-this program is for anyone buying a home with a pre-approved FHA loan or an existing FHA loan.
- Up to $25,000 for closing costs for a home purchased with an FHA loan.
- More funds available on a case-by-case basis-your loan officer will provide more information if you need to request additional assistance.
- Gift funds made available 24 hours after approval.
If you are approved for an FHA loan and want to participate in the Newsong program, take the following steps:
- Find a home and make an offer.
- Once the offer is approved, contact your loan officer and ask about the Newsong program.
- Tell your realtor you want to buy the home using the Newsong program
- Your loan officer applies to Newsong on your behalf.
- Money is available up to 24 hours after the application is approved.
In many cases same-day approval is possible if your loan officer can complete and send the paperwork before noon. The seller must participate in the Newsong program. Ask your loan officer and/or realtor how your seller should sign up for Newsong.
Down payment assistance programs generally require the seller to pay a fee to participate. This fee is considered a payment for services rendered and not a tax-deductible charitable contribution.
Since this program is no longer available, we recommend that you get pre-approved for a low down payment FHA home loan.
Discontinued Down Payment Grant Programs:
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