While legislators are fighting to stop the end of seller-funded down payment assistance, there are some of you out there who don’t want to take any chances in missing out on using these great programs. So when do they end? How much time do you have? The getdownpayment.com Web site, which is a product of the Nehemiah Program, has a countdown clock running that says there are 54 days, 9 hours, 10 minutes, and a few seconds left before the program is shut down. But still… what does that really mean?
Our in-house mortgage team at Carolina One Real Estate provides clarification on how to take advantage of the current seller-assisted down payment programs as the end draws near:
1. Seller-funded down payment assistance will no longer be permitted on loans that are approved on and after October 1.
2. Significant changes, such as property (changed your mind on which house you want to buy) and/or borrower changes (like a new job or new car), after September 30, will eliminate the ability to use seller-funded down payment assistance on the loan because that also changes the date of the loan approval.
3. Loan approval requires all of the following, and any loan using seller-funded down payment assistance must have all items completed no later than September 30, 2008.
- Contract for a specific property;
- Appraisal for specific property must have been reviewed and an appraisal statement issued;
- Credit file must have been reviewed and the underwriter must have had sufficient information to approve the loan;
- When the loan has been approved, the date of the lender’s final submission to HUD is considered the approval date – this cannot be on or after October 1.
Note: Pre-qualifications and credit approvals DO NOT meet HUD’s definition of loan approval. These guidelines affect ALL FHA loans.
