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Many people today are under the false assumption that they need tens of thousands of dollars for a down payment to buy a home due to the sub prime fall out. Nothing could be further from the truth. A little known HUD approved and RESPA compliant program allows any buyer to purchase a home up to a $729,000 purchase price (in some areas) for absolutely NO MONEY out of pocket.

The following is a process to step you through the bascis of buying with absolutely no money out of pocket. This government program is approved by HUD and completely RESPA compliant.

You must first find an expert Mortgage Consultant that’s familiar with FHA and working with a DPA. DPA is short for down payment assistance program. The most popular DPA is the Nehemiah program. Nehemiah has been in existence since 1998 and has assisted buyers with gift funds of over $1 Billion (yes a “B”). They are completely government approved.

Next you will get pre-qualified for a down payment assistance program with a certified specialist. The most important part of qualifying is income verification. You must provide your last 2 years of income verification. Fortunately, credit is flexible. Typically credit scores must be around 580 to qualify but in some cases you can go as low as 550. This is NOT a first time homebuyer program. Anyone buying an owner occupied property is eligble.

Now the fun part begins – looking for your new home. Due to current market conditions this is easier than ever. FHA limits have increased and typically they are around $423,000 for most areas. In certain areas, like Los Angeles county, they go as high as $729,000. These limits should give you plenty of flexiblity to buy your dream home.

Negotiate with your seller to participate in the DPA. The ZERO down home loan program requires the sellers participation to fund the closing costs and down payment. Fortunately, in this market environment sellers are more flexible than ever. The seller will be primarily concerned with his/her net from the sale. So many times your offer will be closer to the list price since you will be requesting a 7-10% contribution for down payment and closing costs.

Meet with your certified DPA specialist to make your mortgage application. It is imperative that you choose an experienced professional who is familiar with the workings of Nehemiah (or whatever DPA you choose) and FHA. Working with an inexperienced “Broker” will cost you. You could lose time, money or even the home that you’ve chosen.

The items that you will be required to have on hand are as follows. You will have to provide your last 2 years of W-2′s or your tax returns if you are self-employed. Have available your most recent pay stub and the last 3 months of bank statements. If you are currently a tenant renting a property you will also need your last 12 months of cancelled checks or a verification from the property management company.

Last but not least is your closing. Many people worry and sweat over this part but if everyone has done their job then it is smooth and seamless. By now all your questions have been answered and there should be no surprises. You know what you rate is, what the term is and how much money is required – ZERO! It’s such a pleasure to see new homeowners walk away from closing with a low 6.0% fixed rate and their new home – wow! You can do it – don’t let this opportunity pass you by.

If you happen to be in the market to Buy a Home then check out Crown Financial Solutions’ Complete FREE report on Buying your PerfectHome with a Zero Down Mortgage or for up to date Mortgage info visit my Mortgage Blog

Comments (0) Feb 04 2010

1. Have your credit checked early in the process. Most people do not know their credit scores or what really determines a good credit score. It is not enough to get a free credit report from a single credit reporting agency. It is important that you have a mortgage planner obtain a tri merge report. This will provide scores from all 3 reporting agencies. Typically the lender will take the middle of the three scores when qualifying an applicant. It’s important to determine if there are credit issues early on. Many times they can be corrected in a matter of weeks and will raise your score. A low credit score can cost you many thousands of dollars in mortgage interest.

2. Do not Accumulate new Debt. Many people begin to get very excited at the prospect of buying their dream home. They begin to think about all the items they will need in their new home. New appliances, furniture or even how a new car will look in the driveway. Don?t laugh, I see it all the time. Do NOT accumulate any new debt prior to closing on your new home or it will through off the qualifying ratios and could cause you to lose the home.

3. Know the level of experience of your Mortgage Planner. Many people have a friend or relative that’s “in the business”. Typically this is a licensed but inexperienced person earning some money part time. Your home is the largest investment you will ever have so it is vital to deal with an experienced person. Ask your Mortgage Planner about their credentials. How many families have they served? How long in the business? What is their experience level with the products or programs that you need. Your Mortgage Planner will be handling your hard earned money – be sure that you have confidence in their ability.

4. Assuming that your options are very limited. Too many people think that their options are now limited because of the strain in the mortgage arena. Maybe they spoke to a bank and found that the bank requires 10% – 20% as a down payment to qualify so they decide to continue renting until they have enough saved. There are still many excellent loan programs available some with ZERO down payment. Speak to your Mortgage Planner about the option that best suits you.

5. Be aware of how subtle changes will affect your score. Show caution in having your credit checked. It is important to have it done by your Mortgage Planner for pre-approval but after that be careful. Lenders will view multiple credit checks as a sign that you are trying to obtain credit and will subsequently lower your score. Never close a credit account prior to obtaining your mortgage approval as this will lower scores also.

6. Do not Purposely leave out important credit details. Your Mortgage Planner is on your side. Past credit problems may be embarassing but they will show up somewhere down the road. Be sure to explain everything so you can have a plan of action ot overcome it. Give them the information so they can provide you with the best possible interest rate and service.

7. Be sure to get a Mortgage Pre-Approval. A mortgage pre-approval is a fast and simple process that cannot be overlooked. A seller will want to know that you haev preapproved prior to negotiating a price with you. The preapproval shows the seller that you are not wasting their time and are negotiating in good faith. It will also give you a great sense of security as you are shopping for your dream home.

If you are looking to Buy a Home then visit Crown Financial Solutions’ Detailed FREE report on Attaining your Dream Home with a Zero Down Mortgage or for up to date Mortgage info visit my Mortgage Blog

Comments (0) Jan 31 2010