Cash Strapped Buyers Could Get Shut Out
If you have buyers in need of 100% financing, take notice! One widely popular tool for funding is about to run out of money. Buyers that need a no down payment loan guaranteed by the USDA are running out of time to get their deal done. This program is a favorite among first time home buyers.
USDA Rural Home Loans have been a phenomenal tool for helping cash strapped buyers get into homes for no down payment. Unlike many other loan programs though, the amount of funds available to fund these loans are set and capped at the beginning of the fiscal year.
Notice was delivered from Washington on March 9 that the funds are nearly exhausted, with expectations that they will run out in late April.
Unlike years past when similar notifications have been delivered, the USDA will not be issuing conditional commitments for buyers as the program awaits new appropriations from Washington. The USDA states they are "not certain when additional funding will be available."
What does this mean for your buyers?
If your buyers need 100% financing and are not eligible for a VA loan, they have to act quickly or they will have to seek other options. Combined with tightening from HUD on FHA loans in April and potentially later this summer, cash strapped buyers may be shut out if they miss this opportunity. To take advantage of the First Time Buyer Tax Credit and the Step-Up Buyer Credit contracts must be signed by April 30th, 2010.
If you have any questions, call me and let's discuss them.
Sincerely,
Richard Woodward
Envoy Mortgage
Phone: 972-661-5136 or Toll Free: 866-430-7767
www.Envoy-Mtg.com
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