HUD TO ALLOW DOWN PAYMENT ASSISTANCE PROGRAM TO CONTINUE
Chairman of the House Financial Services Committee, Barney Frank, has negotiated an agreement with HUD Secretary, Steve Preston, that will allow the continuation of the privately funded down payment assistance programs.
It allows HUD to use risk-based pricing on the down payment assistance transactions. The agreement still needs to be approved by Congress and the President. It is covered by HR 6694.
The agreed upon changes in HR 6694 are:
- Allow down payment assistance for a mortgage where the mortgagor has a credit score equivalent to a FICO score of 680 or greater.
- Allows down payment assistance where the mortgagor has a credit score equivalent to a FICO score of 620 to 679 and the mortgage insurance premium charged would be based upon the score and risk involved.
Risk Base Pricing is the practice of offering individuals with good credit a less expensive loan or a lower interest rate than to others who are credit impaired and have a lower credit score. It is a good idea to put your financial house in order now, before you decided to purchase a house in the future. A higher credit score could save thousands over the life of the loan. For some it could change the loan process from a denial to an approval for a loan.
For credit repair go to: www.htdimortgage.net/zagreb
Dan Garcia
Excel Mortgage, Inc.
Mortgage Consultant
Residential / Commercial
815-886-9024 Office
815-886-3778 Fax
Julie, don't stop petitioning your SENATORS, We are still facing an uphill battle on this. Unfortunately it is a huge battle in the Senate and by no means a "done deal". Yes! Chairman Frank is active on this and HUD is willing to give up their attack on SF DPA but right now it is still "against the law". Most people have no idea about the behind the scenes fight and why this was attacked by HUD. It has nothing to do with default (not foreclosure but default) rates and everything to do with FHA's Department of Single Family Housing Product wanting a 100% mortgage note. In order to get it they had to get rid of SF DPA. Unfortunately what remains is the much less regulated social program funded DPA (no LTV limit and allows a pre-payment [re-capture] penalty) and the interested third party DPA which is completely unregulated. Keep up the good fight Julie! Save the chance to fill 20% to 40% more homes with qualified home buyers!