Las Vegas, Down Payment Grant Never Repaid By Homebuyer!
There are national non-profit organizations dedicated to assisting homebuyers with their down payment and closing costs. The most prominent of the nonprofit organizations that facilitate these transactions are The Nehemiah Program, AmeriDream Inc. and Partners In Charity.
Buyers can receive a free gift under these programs. Gift amounts vary with each program but are generally available in amounts of 3% with some programs, all the way up to $22,500 with others. Buyers never have to repay these gifts.
It’s easy to receive a free gift from these programs, however qualification guidelines do vary with each program. Each program requires that buyers must qualify for any eligible loan program with their lender (there are many programs that qualify).
While this is the only qualifying requirement of some programs, others have requirements such as requiring that the buyer complete a Home Ownership Counseling Course or provide 1% of their own funds for the transaction. In addition some programs have income/asset restrictions, recapture clauses, reserves required or geographic boundaries. Each program can provide you with their specific requirements and/or limitations
These programs generally participate with FHA, conforming, and jumbo loan products. Most of these programs do not underwrite the loan or add any cost in the form of points, fees, etc., they simply provide the gift for the down payment and/or closing costs.
These down payment assistance programs can be used for Single Family (1-4 unit) homes, Manufactured/Modular Homes, Condominiums, Town Homes, Existing or New Construction, Rehab and Jumbo.
There are some excellent down-payment assistant programs. There are also some dubious ones. It’s important to confirm that the nonprofit organization with which you’re dealing is of the former variety before making any commitments.
A good first step is to restrict your dealings to nonprofits that belong to the Home Gift Providers Association (HGPA). The HGPA members are required to adhere to a prescribed set of best practices and a code of ethics. Its website includes a list of member companies.
Interest Rate Commentary
Tuesday: 02/26/08 10:30 AM EST: Despite worrisome inflation data released this morning, Treasuries are ahead following losses in the last two sessions. The losses absorbed some of the negative effect from the inflation news and weak economic data is providing some support. And though all the news is overwhelmingly negative for stocks, the indices are currently only down slightly in choppy trading action.
In the main release of the day, the Labor Department reported that its Producer Price Index (PPI), a gauge of inflation at the wholesale level, rose in January by 1.0%. The jump was much larger than the 0.4% that analysts had predicted. Moreover, the core index, which excludes the volatile categories of food and energy, rose by 0.4% last month, the biggest jump in eleven months. A 0.2% increase had been anticipated.
But some bond traders had been bracing for an upside surprise since the Labor Department last Friday released revisions to past data based on new seasonal adjustments. The new data showed a 0.3% decline in the index in December instead of the originally reported decline of 0.1%. Consequently, January’s bounce turned out to be larger than predictions based on the old data.
In November, the index surged by 2.6%. This was due primarily to an 11.4% jump in energy prices — the largest in almost eighteen years. Energy prices fell by 3.0% in December and rebounded by 1.5% last month. The index for food prices slipped by 0.2% in November but rose in December by 1.4% and in January by 1.7%.
Prices further down the production pipeline also indicated an increase in inflation pressure. At the intermediate stage of production, the price index was up by 1.4% following a 0.2% decline in December. At the initial or crude stage of production, the index was up by 2.5% following a 1.1% rise in December. The core intermediate index rose by 0.8% last month after a flat reading (0.0%) in December and the crude core index rose by 4.0% following a 0.2% rise.
On a year-over-year basis, the PPI was up by 7.4%, the largest rise since October of 1981. The core index was up by 2.3% Y/Y following 2.0% increases in November and December. Intermediate prices were up by 8.8% Y/Y, the largest increase since August of 2006. Core intermediate prices were up by 4.1%, the largest Y/Y increase since December 2006. On a year-over-year basis, crude prices were up by 31.3%, the largest jump since October of 2005.
In the second major release of the day, independent research firm, the Conference Board, reported that its Consumer Confidence Index came in at a five-year low of 75.0 this month. The reading was well below the low end of the forecast range of 80.0 to 83.0 and January’s originally reported index of 87.9 was also revised down slightly to 87.3. The news release said that the index of present conditions fell to 100.6 from 114.3 (originally 115.3) and the expectations index fell to 57.9 from 69.3 (originally 69.6).
In other news, the S&P/Case-Shiller home-price index of 20 metropolitan areas fell by 2.1% in December after a same-sized decline in November. But since the data is not seasonally adjusted, the year-over-year differences are more revealing. The index was down by 9.1% in December relative to the preceding December following a 7.7% Y/Y decline in November. The latest Y/Y drop is the largest in the history of the data series going back twenty years. The declining prices reflect waning demand as credit becomes harder to obtain.
In related news, a report from the mortgage information firm, RealtyTrac, showed an 8.0% increase in foreclosure filings in January. On a year-over-year basis, they were up by 57% and lender repossessions were up by 90%.
Regarding the increase in foreclosure activity, James J. Saccacio, CEO of RealtyTrac, noted that, “the 8 percent monthly increase in January is not as precipitous as the 19 percent spike we saw in January of 2007, and several key states actually experienced decreasing foreclosure activity from the previous month. It could be that some of the efforts on the part of lenders and the government both at the state and federal level are beginning to take effect. The big question is whether those efforts are truly helping homeowners avoid foreclosure in the long term or if they are just temporarily forestalling the inevitable for many beleaguered borrowers.
