The housing crisis will get worse if the down payment assistance programs go away! These have been great programs for those who have little money and wish to keep their money as a "cushion" in the bank for those "rainy days".
The price was increased by 3% and as long as the home appraised, the buyer financed 97% of the increased price, thus saving on placing a down payment.
Soon the consumer will need to use up all their savings to place not 3% but 3.5% down on FHA loans. Their "cushion" will be trashed and if there is any "rainy day", they will become part of the crisis.
WE NEED TO KEEP THESE PROGRAMS ALIVE! Is anyone listening in the "Ivory Tower"?