Downpayment Assistance

Downpayment Assistance
by Somerset Mortgage Lenders: "The Brains, The Courage and The Heart to Make Your Dreams Come True"
http://www.somersetmortgagelenders.com/

Somerset Mortgage Lenders and Gregg Marcus strive to keep the public educated with tips meant to make getting your loan as easy and painless as possible. To this end, they have put together this brief how to guide on downpayment assistance.

Potential home buyers often discover that while they’ll have no trouble making their monthly mortgage payments, they nonetheless can’t buy a home because they lack the funds to make the necessary down payment and closing costs. Fortunately, a number of solutions to this problem exist, one of the most common being: down payment assistance programs.

While sellers are forbidden from giving gifts of down payment funds to their potential homebuyers directly, these down payment assistance programs guarantee that funds to financially-challenged potential homebuyers are delivered at closing to cover all or a portion of the down payment and closing costs.

Only certain sellers will participate in these programs, and it can often take a great deal of work, mandatory classes, and extra paperwork to accomplish. The upside is that not only can people afford homes who otherwise couldn’t, but they might even get a lower interest rate on their loan.
First the seller would enroll the home in a relevant program, contributing funds equal to the amount of down payment assistance the buyer is to receive at the time closing, plus a fee of around 0.75% of the purchase price of the home. Then, upon closing, the down payment is then wired from the program to the agent handling the closing, keeping the seller removed from the process of transferring those funds.

Sellers can also help reduce the cost burden on buyers by offering to pay all or portions of the closing costs involved in the sale of the home. They do this by simply giving back to a part of their proceeds to the buyer at the time of closing. There are limits, however, on how much assistance a seller may provide, depending on the kind of loan the buyer is obtaining.

And though down payment assistance may seem undesirable to sellers considering whether or not to accept someone’s offer to buy their home, it could actually be to the seller’s advantage every bit as much as the buyer‘s. This is because a buyer able to afford the closing costs on a home can more easily get away with making a lower offer (and having it accepted), whereas a buyer requiring down payment assistance is more likely to make an offer closer to the seller’s asking price in order to compensate for their need for down payment assistance.

Realtors and lenders both are qualified to aid would-be homebuyers in finding and selecting the right down payment assistance program. Realtors and lenders alike are generally more than glad to explain how an offer to purchase property should be phrased in order to.

Get a free rate quote now at http://www.somersetmortgagelenders.com/ or call 1-800-675-9783 to speak with a LIVE Loan Officer now.

SOMERSET MORTGAGE LENDERS
Specializing in: purchases, debt consolidation, divorce buyouts, loans for home improvement, mortgages, refinancing existing loans, reverse mortgages, FHA loans & more

get a free rate quote now at http://www.somersetmortgagelenders.com/ or call 1-800-675-9783 to speak to a LIVE Loan Officer.