Nehemiah - AmeriDream -- The Down Payment Programs live on...!!!!!!

Mortgage and Lending with Social Media - Infinity Home Mortgage Company, Inc


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With yesterdays news that the new FHA loan limits were increased, and that Judge Lawrence K. Karlton upheld Nehemiah's motion against all down payment assistance programs to be banned, it's been a very good week in the mortgage industry. 

Here is part of the letter from Scott Syphax (President & CEO of Nehemiah) who states:

Judge Lawrence K Karlton of the United States District Court for the Eastern District of California upheld Nehemiah's motion for summary judgment. The Court Clerk's Office is directed to enter judgment and close the case.

To be clear, the U.S. Department of Housing and Urban Development's (HUD) rule to ban private down payment assistance as proposed in the "Standard's for Mortgagor's Investment in Mortgaged Property" regulation published October1, 2007, is permanently set aside.



Now, what the average consumer needs to understand is that they truly need to work with a mortgage professional that truly knows all programs in and out. Especially with so many recent changes to conventional mortgages in the last several weeks, it is not easy nor may it be your cheapest method in obtaining a mortgage. If you have credit scores under 680 or your credit is less than perfect, you want to make sure that your lender is FHA approved. If they tell you that you aren't approved for a FHA mortgage, but that they can approved you for a conventional mortgage, that should be a major red flag.

Overall, I am not saying that conventional mortgages are bad and that FHA mortgages are great. But the proof is in the pudding when it comes to the bare facts.  You can truly understand my point just on these two examples.








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Copyright © 2008  by Jeff Belonger

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Copyright © 2011 by Jeff Belonger of Infinity Home Mortgage Company, Inc

Comments (28)

Rich Dansereau
Positive Real Estate Professionals - Knoxville, TN
I hope you are feeling better or at least beginning too. Being sick or even feeling run down is awful. This is a good post.
Mar 07, 2008 08:20 AM
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher
Jeff, There is so much to keep up with in the mortgage business people absolutely need a professional...I'm sure those that are reading you will choose you to help them find their best options.
Mar 07, 2008 08:25 AM
Abel Olivo, AHAA
I'm an advocate for non-profit down payment assistance, so when I see comments like Bill's it really gets me going. First of all, ALL organizations that give down payments have to have a 501(c)(3) tax status, meaning that are a charitable non-profit organization...they don't have shareholders to pay dividends, and have been through IRS scrutiny to get that designation. What most people don't understand, including Bill, is that successful non-profits have excellect business models that generate revenue for their programs that help sustain them. Most of these DPA organizations put OVER 85% of revenues back into their programs. When you consider that other non-dpa non-profits typically don't even come close to returning that high percent of revenues back into their programs its hard for me to sit back and let Bill trash DPA...even though he is ok with using these programs.
Mar 07, 2008 08:35 AM
Roberta LaRocca
Simply Vegas Real Estate - Las Vegas, NV
REALTOR®, Broker, Salesperson, NV. Lic BS.507
Jeff, This is great new!  I was wondering if the program was going to get eliminated.  Thanks for the update.
Mar 07, 2008 08:58 AM
William J. Archambault, Jr.
The Real Estate Investment Institute - Houston, TX


"First of all, ALL organizations that give down payments have to have a 501(c)(3) tax status, meaning that are a charitable non-profit organization."  What is charitable about taking money from the seller and "giving" it to the buyer for a fee? In fact it's not charityrt at all it's a contract for services!

If the seller doesn't contract to give money to the "charity" then the "charity" doesn't "give" anything! If the seller doesn't go through with the closing the "charity" gets their money back!

You are right it takes a 501(c)(3) tax status to "give" money to and induaviaul.

That's the only thing you're right about! I didn't trash the "chairty" they have done allot of good. It's the need for this slight of hand that I questioned.  The down payment comes from the sellers equity, why should we have to play games? For a fee no less!

Non-profit doesn't mean charity or for free! Tell me what charitable function any of these DPA orginzations preforms!


Mar 07, 2008 10:08 AM
Karen Cooper
Karen Cooper | Sr Retail Loan Originator ! NMLS # 223305 | 360 Mortgage Group LLC Austin Texas - Leander, TX
Helping Homeowners w/Home Loans in 27 US States
Jeff - This will be a great tool to help offset the ramifications of the "declining value area" delineation. Thanks for a great post.
Mar 07, 2008 11:52 AM
Larry Bettag
Cherry Creek Mortgage Illinois Residential Mortgage License LMB #0005759 Cherry Creek Mortgage NMLS #: 3001 - Saint Charles, IL
Vice-President of National Production
I don't think that we've seen the end of this yet.  Still waiting for congress to make a definitive stand, but we'll see what happens in the long run.  I don't think that this is dead.
Mar 07, 2008 02:58 PM
Alan 'AJ' Nisen California Contra Costa Mortgage Officer
A Large Bank in America - Lafayette, CA

Jeff, yes there was a lot of news this week.  And more to come. AJ

Mar 07, 2008 03:30 PM
Lisa Hill
Florida Property Experts - Daytona Beach, FL
Daytona Beach Real Estate
Definitely good news! (But someone has their knickers in a twist) I sure have read a lot of posts about FHA this week. You're usually the only one I see with anything to report.
Mar 07, 2008 04:30 PM


It is great to see that the program is still going. Keep up the good work - Helping people aquire the Amierican Dream.


Mar 07, 2008 11:43 PM
Melissa Grant
A Serendipity World - Greenbackville, VA
The Law of Attraction In Life & Business
Great news ! Thanks for sharing...this is certaintly the new " buzz"
Mar 08, 2008 12:44 AM
Sharon Filbig
Prudential California Realty - Escondido, CA
San Diego County Real Estate
Whoa, there are some interesting comments on this one!  Anyway, I think this is good news; we need to be adding tools right now, not taking them away. 
Mar 08, 2008 02:47 AM
Serena Brown
Taylor-Brown Real Estate - Hammond, IN
Thank you for this valuable information on the down payment assistance program.
Mar 08, 2008 04:13 AM
Well whoopie that the court decided with downpayment systems but who cares as almost the entire US is in a declining market and one of the policies is that if the house you choose is in a declining market then yo ustill can't use the downpayment assistance programs.
Mar 18, 2008 04:16 AM
Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans


I promise to get back to everyone else's comments.... just been busy and sick.  But I wanted to address Charles comment.


CHARLES......   whose policy?  Nehemiah doesn't say who can lend to what...  and FHA doesn't say that you can't lend in a declining market.  It all comes down to the appraisal. As long as the appraisal has the correct comps and is done properly, there is no issues. And I state Nehemiah because I use them for my down payment assistance programs.

So, I am just wondering where you are getting this kind of information.  Are you a lender?  A realtor?  Just a consumer?  

You are correct that declining markets do hurt loans, but only conventional loans.thanks 


jeff belonger
Mar 18, 2008 06:22 AM
Scott Case
RE/MAX Elite - Satellite Beach, FL

  Hey Jeff,

All of Florida is in a declining market but FHA is still viable here. As you said, it comes down to the appraisal. Sounds like Charles has had some negative experience, possibly with a lender that doesn't know or can't do FHA loans.

Apr 08, 2008 06:19 AM
Lew Corcoran, ASP®
Scena Home Staging & Decora Photography - East Bridgewater, MA
Home Stager & Real Estate Photographer

There's another DPA program you might want to consider using - it's called American Homebuyers Inc. ( They deliver the same service as Nehemiah and AmeriDream (which are my old favorites), but they do have a couple of advantages. 1) They're cheaper (only $295); and 2) each loan using American Homebuyers gift funds includes their comprehensive default management program which is provided by Mortgage Savers, their loss mitigation company, at no extra charge!

The Mortgage Savers service program will do "work out packages" for borrowers who get behind on their payments, and helps to keep delinquent borrowers from default and foreclosure! I find that to be a very valuable no-cost benefit to home buyers who need DPA to buy a home. While many think they willnever need it, having the reassurance that assistance is available if they eve need it - and at no cost - makes this a very viable DPA alternative.

They also offer a Homebuyer's Education Course, an Early Default Counseling Course, and a Foreclosure Prevention Course for home buyers. Each course is $19.95. It's worth checking it out.

May 11, 2008 01:51 AM

Can FHA loans be used for buying investment properties? Any down payment assistance available for investment properties?



May 20, 2008 01:19 PM
Lew Corcoran, ASP®
Scena Home Staging & Decora Photography - East Bridgewater, MA
Home Stager & Real Estate Photographer


The short answer is no.

FHA loans are for single family owner-occupied primary residences only. Buyer can buy a 2-, 3-, or 4-Unit property so long as s/he will live on one of the units as his or her primary residence. The rent from the other units can be used to help qualify for the mortgage.

May 21, 2008 11:17 AM
Michael Kitsch
Coldwell Banker - Katy, TX

Now that Nehemiah is no more, what is your favorite substitute?

Feb 03, 2011 02:05 AM