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Down Payment Assistance non-profit

First of all I would like to apologize to the several active rain members who contacted me with regards to ameridream. The organizations website is as follows www.ameridream.org (NOT .com).

This past week I had the opportunity to speak with almost 1,000 real estate professionals about exit strategies for selling wholesale properties, rehabs, flips, and other real estate investment projects. The main issue is where to find buyers.

Often times the potential buyers are young, low income, future investor types who truly do not have money for a downpayment and/or closing fees. I am hearing that many of these people even submit offers but then get denied because the downpayment requirement is often times higher on a "fixer upper" than a retail type home. But these potential buyers are really interested in the idea of buying a home that needs some work in order to get a great deal.

Sellers of these types of homes are usually left with only one market of buyers that being cash buyers or buyers with equity lines ready to go.

But what about the people who really want to get into a fixer type property but end up denied due to inadequate funds.

We all know the risks involved in "gifting" as a seller or as an agent representing a seller. Some of us may have thought about doing this to get a deal done but we know its unethical and illegal.

I just stumbled accross this website, www.ameridream.org, a few days ago and I am hooked.

This non-profit group allows sellers to make a donation to ameridream for the equivilant amount of the down payment and/or closing costs and then ameridream will make the downpayment for the buyer.

Very cool agency.

Does anyone have experiences with this company? Please share.

Posted by Tony Hodge on 05/26/2007 10:40 AM

Comments (13)

flips, rehab, investor, down payment, assistance, non profit, real estate investment, fixer upper, wholesale, low income, buyer, seller

13 Comments on Down Payment Assistance non-profit

MAY

2007

Anthony thanks for this great resource. Looks like a very good agency... I would be interested in experiences also

Ameridream, Nehemiah have been around for years. They've been quiet for the past 4-5 years because they require a 3.75-4% contribution from the seller and sellers have been loathe to give the time of day for some years now. But, things have changed and these programs may become popular again.

Another one is the NACA, which is really better if in your area. Funded by Bank of America, this program is a $0 down and eliminated the 3% FHA needed for Ameridream and Nehemiah.

This is old news worth mentioning again for new agents Anthony! There are many programs available for down payment assistance. Federal and local programs offer low interest rates on repayment of grants and some are forgiven entirely after 5 years. Most of the prorams involve income limits and all require verifiable credit worthiness. There are also discounts for teachers, firemen and policemen. Good Luck!

Anthony:

Be careful with the DPA (down payment assist.) companies; the IRS is actively working on pulling their non-profit status. (the IRS is alluding that only gov't entities are truely non-profit)

Ck with the DPA company about their status with the IRS. (Nehemiah, Am Dream are on the IRS hit list.)

Ck www.hud.gov for additional information.

Most cities and counties have DPA that can asst your buyers. Also, many lenders have aggressive loan programs to help families afford homes. (ie: ABC has a product for a borrower with 5% down to utilize 30yr fixed rate, 10yr interest only option + adding a temporary buydown in rate: either 3-2-1, 2-1 or 1-1 = meaning your buyer will qualify at interest only and the buydown rate.) example 3-2-1 would allow the buyer to qualify at 3.25% and interest only (with out any negative AM) next yr they will be 4.25%, yr 3; 5.25% yr 4-30 6.25% (interest only for the first 10yrs of the loan..))

they also offer a 6months interest abatement loan: for the first 6months of the loan the buyer only pays principle+tax+ insurance.

just a few thoughts..

Thanks for sharing such a great sourve! I've got at least one person in mind I'll need to share this with. THEY will hopefully thank you soon too!! :-)

Anthony---I loved your comment on MY POST regarding "Dont' you love it when...."

***I appreciate your "reality check" as an agent, realtor, investor, person, etc! I truly believe in this line of business you have to give a piece of YOU!! Sounds to me like YOU posess that quality. :-) Anyhow, that's a quality I admire and wanted to share THAT with you. Ohhh...and THANK YOU for leaving a comment on my blog!

JUN

2007

I can attest to the competency of Ameridream. However, in a tighter appraisal market it can sometimes be a little challenging. But that should discourage the right buyers/sellers from trying.

Nehemiah will assist with from 1-6%.

You can call them and ask for all the information and then you can compare the two. I think they are very similiar and if you find a seller that is willing to at least learn how it works, Nehemiah does have a training package for the seller and the realtor. It seems a good idea to get trained on the program, in case you run into someone(s) that are willing to use the program.

I plan to take the 1-2 seminar, they offer it on webinar. www.getdownpayment.com (877-634-3642)

Hope this helps!

JUN

2007

Chris, Susie & Rosemary-Thank so much for your comments!!!

Rosemary, I am really excited to hear about the Nehemiah training program. Please start a blog about it.

Anthony

Anthony. I did do a post: Nehemiah Program ~ helps make dream of homeownership come true for many

but I will put a little more to it and the training package and requirements. Good suggestion. Please check out my post and subscribe. Thanks

Don't the sellers actually make a higher donation and the agency keeps a percentage for themselves?

JUN

2007

Carol not according to what Nehemiah told me. They said they will do 1-6% match with the seller. All they do is pay escrow and when it closes the seller reimburse them. They are non profit so getting a cut does seem to match. I plan on taking the training and will report it back to the AR group. I am not sure about American Dream.

Hmmm... this is not what I was told. Red Cross, as an example, is "non-profit" too, but that doesn't mean they don't take a lot of money. Their excec are very well paid... and they've taken a lot of heat for it. Please do report back and tell us what you learn.

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