OUR LAST CLOSING WITH GIFT FUNDS. LOOKING AT THIS SALE, IT MAKES MORE SENSE THAN TARP.

Well,

Here's my thoughts....

Assistance programs by their nature create dependency. 

If they could not save for the down payment, my personal thoughts are that they are overextending right from the start.  if you tell me they have to pay that back in 12 months so that someone else may be afforded the same opportunity that's different. 

I have had the pleasure of becoming good friends with my local Subway owner.  He's been in this country 6-7 years.  He was brought over to this country with the assistance of his extended family.  In no time he was able to borrow enough money to open his own Subway.  He in turn has extended the same opportunity to his other friends and relatives (lent money to his family).  That is assistance.  He now is on his seventh year here and now owns three Subways. 

If you do not need to return the favor...you just do not value what you are given...

What's the happy medium here?  Financial education needs to be taught from grade school until high school.  Citizens need to learn how to not spend so frivously and how to save.  Saving for a downpayment is not impossible, why is it so hard for us to learn to save money?

Lenn,

I love the way you think !  And make a point !  Very powerful, yet very direct and specific.  You bring up some great points.  Would be great to get some responses from the political representatives ???  The whole TARP program is now a complete cluster*** - I dont think anyone can truly wrap their arms around it.  I was initially for the beginning bailout but I am beginning to see that I was wrong for having faith and confidence that the right thing would be done... it is a tough topic.   Your point here is that there are some great programs out there that benefit the buyer... and in turn the seller... and in turn the real estate market !!!  And in turn the economy !!!!!!!!! If so, these programs should be applauded and implemented !  Thanks : )

Lenn, I too hope this program comes back. We need it to help set things right and sad but I think your reasons for the disappearance are right-on.

Lenn, good points. The program made sense but the government thought otherwise. Declining values, as others have indicated, would have occurred regardless in my opinion. The economy expanded and then it burst---it happens. No economy can go through continuous "gain"--look at history. This program allowed people to buy homes, make improvements down the road, and pay taxes to municipalities. Let's hope that another venue, that makes sense, comes forward shortly.

Wonderful post!  I've been so frustrated that the first-time home buyer programs are getting the heave-ho.  I actually purchased my first house thanks to the Nehemiah Downpayment Assistance Program.

We've talked before about how valuable these programs can be and the fond hope that they do return in a viable form. The reason they went away under the terms of the July housing stimulus package was because FHA insisted. Their 'data' showed that these DPA financed homes had a higher percentage of foreclosure than some others. Jeez, don't you wish they'd have pulled their heads out on the sub-primes as well? The fact is - just like any other program it can be abused if all parties agree to abuse it. However, it is a lifesaver for many and could be a real stimulus for first timers right now. My step-daughter bought a place in July using Nehemiah - the payments are lower than their rent was and they can easily afford it but didn't have the downpayment. No abse, no fudged appraisal - just a good deal all around.

To the gentleman above with the plan to drop commissions by 50% - some people don't even earn a 50% commission, some earn far more. If your contribution to the transaction isn't worth what you earn on it, you could certainly join one of the companies who don't believe their service is worth it either. Most of those companies have gone out of business in Southern California as buyers and sellers have come to demand a level of service and professionalism in this challenging market. Please feel free to reduce your commission to whatever level you feel is warranted but kindly leave mine alone.

Lenn - I am SO in agreement with what you have written.  Doing away with DPA has really hurt our buyers here.  With regard to NAR lobbying for the program - fat chance.  I will NEVER take them up on their Calls to Action anymore and I really feel sorry for the poor unsuspecting REALTOR who has to call me next year about my PAC contribution! 

It may make more sense than TARP.... 

But if it is so good, then we shouls just make FHA 100%. And do away with the third party fee.

Great Post...I agree...It's another great program that dissappeared because it was misused and abused.  There is no moderation...only market extremes (no funding) to see-saw the after effects of the other extreme (loose funding).

Thanks for the quality, well written blogs!

Sensible Policies and Government Support . . . . sounds like an oxymoron. ~ Evelyn

Seller participation programs are a "Godsend" for some buyers who have good credit and the ability to qualify for and pay their mortgage but just do not have the down payment.  This helps the buyer, the seller and the industry, especially in these times.  I think this is the wrong time (if ever)  to be pulling them!

Lenn, that is so sad but true.  They need to think about and help out Main Street now.