Effective today, April 1, 2010, and good for a limited time only, FHA has announced a new pilot Zero Down Payment Financing program available to self-employed individuals with credit mid-scores of at least 350.
Based on the huge success of the former NINA (No Income, No Assets) loans and other ‘Alt A’ “No Documentation” loan programs which led the housing boom of 2005-2007, the loans will be available for homes which appraise for at least 80% of list price, regardless of condition.
HUD spokesman Noe Jose said, “The program is a trial effort to find a replacement for the hugely successful Tax Credits for Home Buyers which expire April 30. Those Tax Credits are widely acknowledged as boosting home sales during a period of economic uncertainty.” Of course, increased home sales lead to increased employment in the construction sector, one of the largest job creation industries.
On another note, of course today is April 1, widely known as April Fools Day. See http://en.wikipedia.org/wiki/April_Fools'_Day for a thorough discussion of the history of this great day of mischief. Our all time favorite is the BBC’s Great Spaghetti Harvest.
Of course, there will be no “Zero-Down” financing, or any loans for that matter, for people with credit scores under 620. But for those who are eligible and can qualify for a loan, you still have 29 days to find a great home, and get it under contract. As long as the contract is binding by April 30, and closed prior to July 1, the Tax Credits are available. For a complete discussion of eligibility, see this site.
The FED has stopped buying Mortgage-backed securities, and in fact, is now selling them to reduce their inventory. That will put upward pressure on Mortgage Rates, along with the normal seasonal demand pressure. If you are going to take advantage of the Tax Credit or historic low rates, now is the time to do so. If you are thinking about Buying or Selling, or know someone who is, please call us. Waiting could be expensive!
Best regards (and Happy April Fools’ Day),
Doc and Ellen Stephens, REALTORS®
Keller Williams Realty
10999 IH-10 West, Suite 175
San Antonio, TX 78230
(210) 696-9996, ext 409
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