Regarding Down Payment Assistance:

There is a tremendous amount of confusion regarding down payment assistance for FHA insured mortgage loans.

For the record: Down payment assistance grants are NOT going away with FHA on Oct 1 or anytime thereafter. Here's a list of acceptable sources of down payment:

1.) Borrower's savings
2.) Gift from a family member
3.) Grant from a non-profit foundation or charity
4.) Grant from a gov't agency
5.) Proceeds from the sale of a residence

What has changed is that HUD has finally won a long battle against seller-funded down payment assistance. Ameridream, Nehemiah, H.A.R.T. have been in litigation with HUD for the past 7 years (seller-funded down payment assitance grants were forced on HUD after a court battle in Januray 2001.) The performance of loans using seller-funded down payment assistance has been terrible - so poor, in fact, that Congress banned them as part of the landmark FHA Modernization Act passed on July 31 of this year.

From an FHA Lender. I'm not a Realtor.

Lucy, You do need to get an agent. That's the first step. Then get prequalified...that's step two. Most of the bond money programs I know about in Texas are out of funds. Some say they will try to raise more money in the Fall, but currently the ones I know about have told me they think they won't be able to price the bonds at a competitive rate that will allow for sale, so in the end there may be no money on grant programs for a while for 1st time buyer down payment assistance. There are also some pretty strict income guidelines as to how much money you can make and still receive assistance. They are worth having your lender check out though. If you can get some free money you should take advantage of it.

Lucy,
One other thing you want to watch out for is if you are specifically looking at a new home from a builder, they may take away some of the incentives that they are offering if you don't use their lender. CTX is a great company that has been in business for decades. You do want to get a Realtor who can help you negotiate, look over the estimates that you are given and give you advice accordingly.

Naima

Thanks Tom:) DPA is going away, but it hasn't left yet. All DPA loans will need to fund by September 30th, there is still time to use dpa. Bond is local money is always available in different areas and it is free money, usually the only stipulations is to take a couple of classes, and sometimes be a first time homebuyer...bond money is reliable money, I have never closed a deal in my 10 years where the money was not at the title company. Also there is the MCC program which will significantly reduce a homebuyers monthly payment by as much as $166 per month, and the $7500 tax credit that is now available. I like to keep up with the programs available to save my clients some $$$'s.

Hi Lucy,

I'm sorry to hear that you are confused w/ the whole process; however it is extremely common. With that said; I'll jump straight to the point.. You MUST find a GREAT Realtor first as everything you are asking and needing advice on is what an expert Realtor should already have answers for.

Perhaps interview 3 different agents in your area w/ proven track records and see which one you feel most comfortable with; then move forward with them.

Best of luck.

As a quick side question to Tom's addition about the DPA: I don't think Josh was completely wrong by stating "downpayment assistance is going away" as it is as a matter of fact. Am I missing something? I didn't know DPA's were area specific as I have heard it will be a NATIONAL change. If I am ill-informed; please let me know. Thank you

I would like to follow up....
Do NOT listen to some out of town realtor who tells you that Down Payment Assistance isn't being funded. I know this to be NOT the case.
Consider Valerie, who posted below, as a local expert. She lives and works YOUR area. She knows these assistance programs!!!.... unlike some out of town realtors who seem to be expressing their knowledge in this market?!?!?!
Again... Good Luck!!!

Hi Lucy,
Straight to the point, downpayment assistance is going away. These government bonds are no longer being funded and will not be available after Sep. 30. If you want to get these funds, you will have to act quickly. The best place to start is with a qualified Realtor®.

Of all the people involved in your home transaction, your Realtor is the one person that has a duty to perform your wishes and advise you in your best interest. The first mortgage broker you speak to will try and convince you to use him or her and then the second, etc. Discuss these details with your Realtor to get a better picture of how their offers compare to market trends.

If you are already in credit repair, make sure and keep in touch with the company to track your progress. It also helps keep them on the ball and on your case. Everyone needs a little nudging here and there. Your Realtor can advise you on the steps to take in order to become an attractive buyer with respect to your credit and qualifications.

To sum it up, find a Realtor first. If you have nowhere to start, find one on here or open up the yellow pages. Make sure and call at least 3 different ones and go with the one that makes you feel the most comfortable. Good luck!

You should get a Realtor to help you from the beginning. Many new home builder will only offer you incentives and assistance with closing costs only if you use their loan officer, a good realtor can help you fight this type of railroading it is not legal. The is help available to you. I am a Real Estate Broker in Rockwall, and I will be happy to go over all your options available. 972-961-7438 my name is Valerie.

Realtor or Lender 1st doesn't matter. But the first thing your realtor will do is refer you to a lender or otherwise direct you to get a pre-approval.
CTX is about gone. Unless you are working with Centex Homes.... I believe the CTX division that handles loans for Centex may stay around. So check into that.... a pre-approval from a company that is slowly ceasing to exist isn't a good pre-approval.
Ask your friends and family or coworkers for a referral to a realtor in your area. That realtor should be aware of any First Time Homebuyer programs there.
I know it is scary. Just know this: If you feel like the lender isn't going over EVERY bit of the process with you or you otherwise feel like they do not have your best interest at heart.... find a new one.
Good luck!!

Lenidng answer:

Lucy, I think any of us in the mortgage or real estate business can understand the frustration and intimidation that buying a home may create for the first time home buyer. We all were once where you are now.

A couple of bits of advice:

(1) Remember that YOU are in control. You are the buyer and the borrower. You do not have to say "yes" to anybody for anything unless your questions have all been answered to your satisfaction, and you are confomfortable with the transaction.

(2) There is no such thing as a dumb question, and there is no such thing as too many questions. You are hiring professionals to help you - a Realtor and a loan originator - and they work for YOU. A good professional will explain all the terms of the transaction, advise you on the best course of action, and explain the answers to every one of your questions.

First, I would find a Realtor to help you with basic research on neighborhoods, home styles, etc - all of the things that are important to choosing a location. With some basic research in hand, you'll have an idea of price ranges and will be ready to hire a mortgage lender.

Second, I'd require the mortgage lender to preapre a Pre-Approval. This means the lender's underwriter will review your income, employment, assets, credit report, and supporting documentation needed to close your purchase mortgage. With a true Pre-Approval, the underwriter has everything in hand except for the pruchase contract, appraisal, and title work. You'll know the terms of your loan in advance, and the Pre-Approval is a powerful negotiating tool when placed inthe hands of your Realtor.

To hire a mortgage lender, I'd ask your Realtor for a recommendation. Why? Because Realtors' pay checks are dependent on closings. A good Realtor will work with 1-3 loan originators who demonstrate to the Realtor and her clients solid, dependable performance. You can get a second opionon from your bank.

I would say to get a good Real Estate Agent who has the experience to put you on the right path. They should be an expert in the new home building field.
The Realtor and you should discuss all your needs and wants and proceed from there. A great agent will not just make you their client, they should make you a friend as well. I can see your frustration in buying your first home. Just interview some agents and see who is right for you.
Hope this helps. E-mail or call me with any questions. I would love to help.
Thank you,
Jeff.
Jkagent@gmail.com

I am a Dallas Real Estate Agent, Dallas home loan mortgage officer. You dont have to work with CTX mortgage your choice for a broker. Need lender approval THEN a realtor with bank specifications provides buyers agent instructions how effectively work on your behalf locate a home or work with builder.
Contact my office if I can be of further assistance 972-699-9111
http://www.lynn911.com http://www.homes-for-sale-dallas.com

Lucy, Please give me a call. Are you looking in Woodcreek? I'll be happy to help you.

214-289-8555
naima@sumner-realty.com

first step is begin the prequalification service, if they have a lender that is already done loans in that project or subdivision, it will be easier for you as they already have the informatiuon they need as far as the project. Yes you should hire a buyer broker to represent you,. i would ask friends, relatives or coworkers who they can recomend, if no one can help then interview some in your area, find someone who is compatable with you. Make sure they will take their commission from the listing broker so it doesnt cost you anything more. Between the buyer broker and the mortgage company they can assist you with first time buyer programs in your area. good luck