Michael Creed's Blog

If you read my blog weekly, you know that in last week's article, I introduced commentary about HR 3221 that was signed into law by President Bush on July 30, 2008.  The "sleeping bear" in this bill was the elimination of downpayment assistance (DPA) programs.  Borrowers who are credit approved prior to October 1, 2008 can receive downpayment assistance and have their loan FHA-insured; after October 1, 2008, that will be gone.
 

Although HR 3221 was created to revitalize - rescue, if you will - the housing industry, it is my opinion and the opinion of many more insiders that the elimination of the DPA program will have the exact opposite effect. Beyond this, HR 3221 also increased the downpayment requirement from three percent to three and a half percent. This combination seems counter-intuitive to a market that is flooded with inventory and in desperate need of first time buyers....who's downpayment requirements will now be harder to meet.

Preserve downpayment assistance programs for families who are credit-worthy, but lack the savings necessary to fulfill their homeownership goals, protect the already fragile economy, improve the current housing market, and save jobs.
 

Currently, about 40 percent of the monthly FHA loan origination volume utilizes downpayment assistance to help lower-income Americans meet the previously mandated 3 percent downpayment requirement.  It is estimated that 10-25% of potential homebuyers (approximately 50,000 nationwide) will have no way of securing homeownership without DPA programs. With the stroke of the president’s pen, millions of deserving Americans are now left with zero alternatives for attaining homeownership.
 

In order to save downpayment assistance programs, we all need to come together now to convince Congress to pass H.R. 6694 that allows downpayment assistance to continue indefinitely.

On July 31, 2008, a new bill, theFHA Seller-Financed Downpayment Reform and Risk-Based Pricing Authorization Act of 2008 (H.R. 6694) was introduced by several members of Congress.  Representatives Maxine Waters, Gary Miller, Al Green and Christopher Shays sponsored the bill that if passed and signed into law will allow downpayment assistance to continue indefinitely.

Take Action by clicking the image below and calling on Congress today!

Support HR 6694!   New Homeownership Bill reforms DPA Call on Congress Today!

Additional Resources:

• AmeriDream - www.ameridream.org

• Nehemiah Coporation - www.GetDownpayment.com