New Homeowners: Down Payment Assistance

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Image courtesy of Stuart Miles / FreeDigitalPhotos.net

Over the past year I’ve been reminded of one thing constantly: A true, detail oriented person is few and far in between. I’m certain this pertains to some industries more than most but I see it consistently in the Mortgage realm and with Realty as well.

A young couple that was referred to me by a past client were first time home buyers and were looking to take advantage of any assistance they could find. They knew a Realtor through the friend of the family who helped them find a home in the area they were looking at.  Low and Behold, it was in the city of St. Paul and the borrowers looked to be eligible for Down Payment Assistance. The Realtor looked into everything for them and told them which amount they would qualify for, convincing them to put an offer on the house.  Their offer was accepted.

When they came to me with the Purchase Agreement and nothing but excitement about the Down Payment Assistance (DPA) Program I made sure to let them know that until we have the final approval from the program, that they shouldn’t count on the money for certain.  I said this for two reasons.  

1. Each family has to qualify for a program, the requirements vary from program to program.

2. Not all banks or Lenders accept these programs and we will need the Lender to accept the program as well.

With each of these, I make sure on my end to walk them through each step, so I fill out the application for Assistance for them while simultaneously working to get Lender approval. Looking over the DPA I realized there was a very strict income restriction, which is typical.  The unfortunate part, is that this resulted in the young couple qualifying for $2,500 instead of the $5,000 the Realtor promised them, leaving them disappointed but still able to buy the home because they had been saving up a down payment in the interim due to my advice.  I’m a geek, I read and read and read because I won’t make a promise to someone unless I’m 150% sure it’s true. 

The devil’s in the details, as they say.  I’m glad I was able to prepare them for a very serious problem before it cost them their new house. Their daughter is just starting to crawl and I bet she loves the house too!

-Matt

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