| What is down payment assistance? | | | | Advantages of down payment assistance programs: |
| You can get as much as 97.5% of the home sales | | | | There are many benefits to the buyer. The buyer |
| costs financed through home loans. But you are still | | | | can buy a home even if she doesn't have money for |
| required to raise 3% of the final cost of the home | | | | down payment and she does not have to pay back |
| on your own. Plus, there is the 1.25% closing costs | | | | this fund. The seller can attract more number of |
| that form a part of the 3% that has to come out of | | | | buyers for his home under this program. The seller |
| your pocket. And if you are from the lower or middle | | | | does not have to lower the sale price of his home |
| income group raising this 3% is indeed quite a | | | | and usually gets a tax deduction which he can utilize |
| challenge. You cannot always rely on your savings or | | | | to offset the capital gains tax he has to pay for the |
| help from family and friends. Now, down payment | | | | sold property. This program is profitable for all parties |
| assistance programs can give you a real helping hand | | | | involved. |
| and help you own a home of your own. | | | | Organizations that offer down payment assistance: |
| Down payment assistance programs offer home | | | | There are many organizations that offer down |
| buyers gift funds that can be utilized to cover the | | | | payment assistance programs. AmeriDream Inc. |
| initial costs of buying a home. The great news is that | | | | offers a popular assistance program but buyers must |
| these funds need not be paid back. Down payment | | | | purchase a home enrolled in The AmeriDream Down |
| assistance programs are offered by non-profit | | | | Payment Gift Program. Nehemiah is a private |
| organizations committed to helping people become | | | | California non-profit organization that offers down |
| home owners. The down payment funds offered by | | | | payment assistance programs to first time |
| these organizations usually range from 3% to 6% of | | | | homebuyers. Under the Nehemiah program, buyers |
| the home's sale price. | | | | can get down payment assistance for up to 6% of |
| How does it work? | | | | the final contract sales price. The buyers can use this |
| Down payment assistance may seem too good to | | | | fund as a down payment or to cover the closing |
| be true for a home buyer who is in desperate need | | | | costs on the home. Several builders like Remington |
| for money. But it is a very smart business proposition | | | | Homes in Illinois have associated with Nehemiah to |
| - one that involves the seller, the home buyer and a | | | | offer gift funds to first time home buyers. There are |
| third party which in this case is a non-profit | | | | other organizations like HART, Partners in Charity, |
| organization. Here's how this program generally works: | | | | Family Home Providers, Futures Homes Assistance, |
| 1. The buyer looks for a suitable home. Some down | | | | Genesis, NewSong, Responsible Home, Quickdown |
| payment assistance organizations have a list of | | | | and American Family Funds that provide down |
| homes for sale from which the buyer may choose to | | | | payment assistance. |
| own a home. The buyer must also check with the | | | | Things to keep in mind while opting for down |
| lender, in most cases the FHA and get the mortgage | | | | payment assistance: |
| pre-approved. | | | | There are a few things to consider while opting for |
| 2. If the seller agrees for the down payment | | | | down payment assistance. First, use a real estate |
| assistance program, she must make a donation | | | | agent to appraise the value of the home you wish to |
| (which is usually tax deductible) to the non-profit | | | | buy. Some sellers inflate the price of their home to |
| organization instead of reducing the sale price of the | | | | offset the donation to the third party organization. |
| home. The organization, on the other hand, uses the | | | | Second, look around for the down payment |
| donation to provide funds for the buyer. The seller | | | | assistance program options available to you. Make |
| gets to sell the house, the buyer can afford a new | | | | sure you are dealing with a reliable, ethical |
| home and the organization receives a portion of the | | | | organization- AmeriDream and Nehemiah are |
| donation. It's a win-win situation for everyone. The | | | | well-recognized down payment organizations. Ask a |
| reason for the third party involvement is because | | | | lot of questions and get the facts straight. Be |
| federal housing regulation prohibits a seller from | | | | well-informed. Once you're through with all these |
| directly giving a buyer down payment money | | | | procedures, sit back and enjoy your very own home. |