Down Payment Assistance Programs - Nehemiah, AmeriDream & others.. is there still hope?

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Down Payment Assistance Programs - To include Nehemiah programs, AmeriDream programs, and many others, have been labeled to be finished as of October 1, 2008 by Congress. In this post, I wrote about the reasons and perceptions to why HUD and the government feel that they need to ban these types of programs.  Please read : Nehemiah & Down Payment Assistance programs done? Is this true? - Urgent Urgent - 

What has happened since Congress voted to ban these down payment assistance programs, 4 individuals in Congress have turned around and enacted a new bill, H.R. 6694, which would allow the down payment assistance programs to continue. 

I have spoken to many loan officers who have 10 years or more of experience in the mortgage industry. Every single one of them are for Down Payment Assistance Programs. Many of us feel that HUD's numbers of 1 out of every 3 DPA's go into foreclosure are very misleading.

FHA loanswere started in 1934 and the sole purpose was to help homebuyers to obtain the American Dream.  Now, it went through many changes in the 1960's and 70's, trying to make the dream more of a reality. For a complete history of FHA loans, please click this link : FHA loans- Wikipedia

My disappointment in this whole stance by HUD and the government is that they state a stat, but don't break down the types of foreclosures and why. As I have stated, I have been doing down payment assistance programs since 1997. How come they weren't an issue then or even 4 years ago? The economy is not in the best of shape now and in my opinion, the politicians are stepping in and trying to correct a wrong, when they are making a wrong. 


Please read below.  This is part of an e-mail from Nehemiah, which talks about their efforts and what we can do.  You can also go to : and help with this cause. Make your voice heard!!!





















 You can also go to this web site to support the cause : To support the DPA programs, please go to and make your voice heard.



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Copyright © 2008 by Jeff Belonger

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Jason Crouch
Austin Texas Homes, LLC - Austin, TX
Broker - Austin Texas Real Estate (512-796-7653)

Jeff - Based on my admittedly limited knowledge of these programs, I also feel that they should continue to exist to help those in need.  I agree with your statement that they are trying to correct a wrong, but they are making things worse, not better.  The tighter mortgage guidelines have hurt the economy in several ways, in my opinion.  I don't think that some of the original interest-only and VERY subprime loans should still be offered, but it seems like they are now throwing out the baby with the bathwater by making home ownership more difficult.  Coupled with a struggling economy, this does not bode well.

Aug 13, 2008 04:36 PM #1
Karen Staha
Gaston & Sheehan Realty - Round Rock, TX
CRS, GRI, ABR, REALTOR, Austin & Surrounding Areas Texas

Yep. You are right.  There's more behind the foreclosure market than the loan programs.  Like home equity loans given on over-inflated appraisals.  I personally do believe (and you might kick me if you could) that every person deserves a chance at home-ownership but when buyers get in with 0 down out of pocket, there's not a dimes worth of loss risk.  Like I say "It costs more to rent a home than to buy one"

Aug 13, 2008 04:40 PM #2
Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans


JASON C. ..... if they are treated correctly when being approved by credit and income standards and aren't abused when it comes to the appraisal part, then they really should be no different.  In regards to interest only and subprime loans, there are hardly any left.  It's extremely hard to get a subprime loan, which is good.  Most of their guidelines are much harder than FHA, so why even go in that direction because your rate would be much higher.

KAREN S. ......  yes, I truly think that there is more behind the foreclosure figures, to as why and how. But I disagree with your next statement, stating that buyers with 0 money down doesn't have a dimes worth of risk in losing anything. Yes, they have no skin in the property. But in all honesty and reality of things, do you think having 3% into any deal is going to keep anyone from walking away from their property????  I know many that have walked away from their properties with 20% down, after their home values decreased.  There are so many variables and that is the same excuse the gov't and many others are making, is the lack of contribution from the buyer. I just think it is a poor reason, given the economy and many job losses...  sickness, death, divorces, etc etc.  Just my opinion.  If you get a chance, read my link in the post about down payment assistance programs being down, urgent, urgent. This might shed some light in regards to what I am talking about.  thanks for yours.


Aug 13, 2008 05:11 PM #3
Fred Chamberlin
Guild Mortgage Co - Oak Harbor WA - Oak Harbor, WA
Oak Harbor/Whidbeynulls, #1 Experienced FHA Mortgage Consultant

Jeff - you have hit it right on the head. We keep getting things taken away and nothing coming our way to help in this process. DPA, while not perfect, are better than not having them.

Aug 13, 2008 05:29 PM #4
Richard Byron Smith, NMLS #184479
Mortgage Loan Officer, Fairway Independent Mortgage Corporation NMLS #2289 - Chattanooga, TN
Mortgage Loan Officer


Here is a link from Ameridream. They are holding a Virtual Town Hall Meeting Tuesday, August 19, 3pm EST.

Registration link

 It took the companies a couple weeks to respond to the new law, but they are taking steps now. It would help if we joined them.

Although my emails to representatives did not get read - you can tell that from the replies.


Aug 13, 2008 11:08 PM #5
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

Thanks for the information.

Aug 13, 2008 11:27 PM #6
Steve Dalton
219-465-8352 - Valparaiso, IN
Northwest Indiana Home Builder

Each DPA group was a little slow in responding, but the Nehemiah campaign is the most aggressive now that they're finally rolling.

Letters to Congressman may not matter much since they have given themselves a 5 week vacation, while oil drilling and housing issues hang in limbo, I guess they were tired.

Best way to reach out would be to actually go to the Congressperson's office, a group meeting would be even better. 


Save Down Payment Assistance

Aug 14, 2008 01:09 AM #7
Scott Geary
Infinity Home Mortgage Company Inc - Allentown, PA
Your Pennsylvania Mortgage Source

The basic premise of most down payment assistance programs are manipulative within the sales transaction at best. Community sponsored assistance programs like 'HOOP' here in Allentown which provides home buyer education along with assistance that is forgiven after a predetermined period of time of ownership and occupancy offers legitimate assistance and long term solutions to the crisis. Any programs requiring seller involvement to the end of assistance are certainly improper, given the challenges in real estate market and issues facing the mortgage industrytoday.

Aug 14, 2008 01:59 AM #8
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'm not sure that they can ressurect this.  However, with all of our feel good politics the lobbyists will be all over this.  I understand why FHA and the new Act would want to eradicate DPAs.  I do.  Highest foreclosure rates, fraud, etc. 

But there are a lot of people who legitimately will benefit from having DPAs.  I know that there is panic in the market when this will go away.  Chase yesterday, gave national notice that effective immediately, they will no longer buy FHA DPAs.  NO NOTICE. 

Unless this gets resurrected, we're going to lose a legitimate part of the population who would benefit from DPAs.  I'm mixed as to whether this will occur.  All we can do is speak up.

Aug 14, 2008 02:21 AM #9
Bo Hussung
Bell Title /Triserv LLC - Nashvle, TN

Jeff, I am glad you have brought attention to was my understanding tht Congress has this on the agenda as an addendum to the current law. I am signed in and support the effort!



Aug 14, 2008 03:17 AM #12
Richard Byron Smith, NMLS #184479
Mortgage Loan Officer, Fairway Independent Mortgage Corporation NMLS #2289 - Chattanooga, TN
Mortgage Loan Officer


You can add Wells Fargo to the no DPA list, effective tomorrow for new registrations.

I had been more concerned that the DPA companies would close before the deadline. I really had not anticipated the lenders dropping early. Vertice has not accepted them for a good while.


Aug 14, 2008 06:11 AM #14
James Wexler - Scottsdale, AZ

there is still hope. I believe we will see a revision that will provide down payment assistance to those who truly can afford the mortgage payment. however, just need help with the down payment

Aug 14, 2008 05:43 PM #15
Richard Byron Smith, NMLS #184479
Mortgage Loan Officer, Fairway Independent Mortgage Corporation NMLS #2289 - Chattanooga, TN
Mortgage Loan Officer

Has anyone seen any explanation for increasing the actual downpayment to 3.5%. Did that come from HUD or did they just make it up?

And they removed the feature to allow portions of the required investment to be used for buyer costs.

What was the reasoning in that? Was that from HUD?



Aug 16, 2008 12:18 AM #16
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