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How to Write a Contract With A DAP

First off – A DAP is the “mortgage babble term” for Down Payment Assistance Programs.  These programs USE to be funded by a SELLER paid contribution – these days, however, “the Home Seller can only help buyers pay closing costs by giving a portion of their proceeds back to the buyer at closing, in the form of closing costs.  When you are trying to figure out How to Write a Contract With A DAP it can be tricky.
How to Write a Contract With A DAPIt’s not really writing a contract with a Down Payment Assistance Program that’s a problem… frankly it’s getting one APPROVED by the Seller, in today’s Market that can be a challenge.
Why would a Seller Care if the Borrower has a contract with a DAP?  
Because we are in a “Sellers” Market, and many times, the borrower who is using a DAP is considered a “weaker” borrower.  We’ve been able to “counter” this recently, and had 2 borrowers who are using a Down Payment Assistance get their contract approved.
Here’s what we suggested… both of our borrowers were using a Conventional Loan for their mortgage.  A DAP can be used with FHA, VA, USDA Home Loans or Conventional Financing.  Each program requires a ... more

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