Don't shoot the messenger; I am just trying to keep you informed. Yesterday morning President Bush signed H.R. 3221 into law. This Housing and Economic Recovery Act of 2008 crafted by the Senate and Congress has a provision that may affect you greatly, especially if you are a first time home buyer. One of the provisions in this bill is the abollishment of seller funded Down Payment Assistance "DPA" programs such as Ameridream and Nehemiah. The provision of the law becomes effective on October 1, 2008.

If you are planning on purchasing a home this year and are looking for assistance on your down payment, then please read carefully.

We are "business as usual" today. With the passage of the Housing Bill from last week, which is awaiting the Presidents signature to be enacted into law, the DPA Industry will be eliminated. The cut-off date as we have heard is established from HUD is currently October 1st, 2008. We understand that all deals with DPA programs must be "Fully Approved" prior to the cut off date and those that are will be honored by HUD and fund those FHA transactions.

--Barry Antle, Regional Account Manager for Ameridream

Here is what the down payment assistance provides based on different sale prices.

$150,000 home = $4,500 of down payment assistance

$200,000 home = $6,000 of down payment assistance

$250,000 home = $7,500 of down payment assistance

$300,000 home = $9,000 of down payment assistance

In some cases this Down Payment Assistance can make or break a potential buyers ability to own a home. If what is written above applies to you, then I suggest you act sooner rather than later. I am not saying that you can't wait until September 30th to close on an FHA loan with down payment assistance - but am saying that I don't think it would be very smart to do so (some lenders may have earlier cut off dates).