Down Payment Assistance Available throughout Georgia

There have been multiple inquiries recently about the availability of down payment assistance in a given county or region, so this series will cover information about what forms of 100% financing are available and where.

Assistance throughout Georgia

Programs of some sort (down payment assistance or loan programs) are available for use throughout the Peach State. Down Payment Assistance Programs will often limit availability based on incomes by household size and credit while loan programs available throughout Georgia may only apply to those in a given profession. Of course, the HUD Home $100 Down Program is available to buyers of HUD owned homes using FHA Financing only, but there are no income limits, class requirements or required professions.

The Federal Down Payment Assistance Program – This program serves all of Georgia, including the City of Atlanta by matching the borrower’s contribution with an interest and monthly payment-free second mortgage of up to $5,000. Income limits apply and the borrower must qualify for a first mortgage, but the loan is forgiven by 20% each year that the borrower remains in the property as an owner occupant and no home buying class is required.

HUD Homes for $100 Down – Buyers who plan to use an FHA mortgage to purchase a property might be interested in the wide variety of HUD-owned homes available throughout Georgia. Townhomes, single-family homes and condominium units are often available in newer communities, golf communities and established neighborhoods. Many of these properties are in move-in condition, allowing the buyer to move in right after closing and the appraisal is usually already done which could translate into savings on funds required of the buyer to close.

Special Loan Programs – Doctor’s mortgages are available through participating lenders to medical doctors who seek to purchase a property anywhere in Georgia while military personnel have access to VA Loans for the purchase of a property anywhere in Georgia.

Come back soon to hear about the various programs available throughout Metropolitan Atlanta. If you are not working with an agent, please call today so that you can speak with a participating lender about your specific needs.

Solomon Greene
REALTOR® Keller Williams Realty Atlanta Partners
http://www.AtlantaDownPaymentAssistance.com
(678) 775-2677

New Year and GA First Time Home Buyer Changes

Happy New Year!

A few adjustments have been made to some of the GA First Time Home Buyer Programs going into effect in 2012 that should be of interest to readers. More specifically, there have been changes to maximum income limits for some programs, changes in benefit amounts, home classes and more. Read on for important details.

Income Limits – First, the good news. The income limits on local Neighborhood Stabilization Programs have edged up slightly in recent weeks. At the start of 2011, a four-person household could earn a maximum of $81,960. That figure has now risen to $83,150. Please see the Gwinnett County NSP flier for other important information including income limits by household size.

Regretfully, the income limits for other standard programs such as the Federal, Clayton, Dekalb, Fulton and Gwinnett County GA First Time Home Buyer programs have declined slightly. At the start of 2011, a four-person household could earn a maximum of $56,950, but may now earn a maximum of $54,650. Please call or write for other important information.

Federal Down Payment Assistance – The matching ratio has been reduced from 5:1 to 4:1 (four dollars of assistance for every dollar of cash that the homebuyer provides for the down payment and closing costs), but the available benefit amount has also been lowered from a maximum of $7,500 to $5,000. The minimum borrower contribution remains, however, at $1,000. Please call or write to get started today.

Gwinnett County Standard GA First Time Home Buyer Program – Pre-applications are being accepted and a waiting list maintained in anticipation of 2012 funding expected in late February or early March. Those who are looking to close in Spring are advised to get approved through a direct participating lender and get on that waiting list right away. Please see the Gwinnett County tab and then call or write for details and instructions.

Home Classes – GA First Time Home Buyer Programs and others often stipulate that the home buyer must attend home classes with a HUD-certified affordable housing counseling agency as a condition of approval to participate, some of up to 12 hours. Many providers, however, have ceased operations, so please call or write today for a fresh list of available classes in Metro Atlanta.

Solomon Greene, REALTOR® Keller Williams Realty Atlanta Partners
(678) 775-2677
http://www.AtlantaDownPaymentAssistance.com
http://www.MetroAtlantaHomesOnline.com
http://www.TheGeorgiaHomeSearch.com

Timeline to Home Ownership - Within Three Months

The final post in this series is being written with the assumption that the buyer is now under contract to purchase their chosen property and that a dedicated buyer’s agent is fully invested in the process.

Help Your Resources Keep things Moving –The agents, lender and attorney will request a few things once a contract to purchase is in place, so please have copies handy for that purpose. The earnest money (where applicable – and it usually is) should have already been turned over to the buyer’s agent. The lender will immediately need a copy of the contract signed by both parties, updated paystubs, updated bank statements, first time home buyer class certificates, employer human resource contacts and more. The closing attorney will want a copy of the executory purchase and sale contract, borrower contact information, lender contact information, hazard insurance provider contact information, home warranty information and more. Please be prepared to patiently send some or all of the requested items more than once.

Ask the lender for and then review the Good Faith Estimate for accuracy and to ensure that the funds required of the borrower to close are or will be available at the time of settlement. These estimates should match very closely with the preliminary HUD statement to be provided within days of the closing date.

Know the Rights Provided for in the Agreement – Contract documents often vary by property, seller, type of purchase transaction and a number of other ways. It is important, therefore, to know what rights are provided to the buyer in that document along with their time frames before a contract is established and earnest money deposited. The buyer’s agent should clearly explain the document terms

• Whether home inspections are allowed, the type of home inspection allowed, when they must be completed, who connects the utilities for those inspections and the borrower’s options should the property be deemed unacceptable.
• The length of time that the lender has to provide a commitment letter
• The disbursement of earnest money in the event of default by either party
  

Relocating to the New Place – There is the small matter of moving that also must be considered. Here are a few family matters that will need attention along with the purchase of the new property.

• Forward mail
• Advise financial institutions, employer, friends and family of the upcoming move
• Connect / disconnect utilities
• Contact schools at new / old locations
• Arrange for the move to the new residence
• Honor commitments and responsibilities associated with ending possession of the previous residence
  

Prepare for Settlement – It is an exciting time, but preparation will help ease some of the nervousness often associated with closing on the purchase of a property.

• Notify the closing attorney’s office well in advance of any potential language barriers
• Request a blank closing packet. The closing attorney should explain each document that the borrower will be asked to sign, but time may not be available to read through all of them at the table.
• Review the preliminary HUD statement to confirm accuracy and that the funds required of the borrower to close are available
• Confirm how the closing attorney prefers to receive funds required of the borrower to close (wiring instructions, certified funds, etc.)
• Get directions to the closing attorney’s office
• Have a government-issued ID and personal checkbook
• Arrange for child care during closing
  

Finally, please know that closing dates change frequently, often disrupting plans with movers, landlords and employers. The first monthly mortgage payment is often several weeks away making it unlikely that a final rent and first mortgage payment will be due consecutively, so plan to close a few weeks earlier than the “must-move” date to limit stress and allow for any disruptions.

Many HUD-certified Affordable Housing Agencies offer post-closing home ownership classes to home owners who want to understand their rights, budgeting, saving, home care and a variety of other useful subjects designed to help them maintain and keep their home. Call or write for more details on these and other programs available to Georgia home owners that ease the path to home ownership. Like Metro Atlanta Down Payment Assistance on Facebook for updates on Georgia Down Payment Assistance, buying Atlanta area residential real estate and more.

Solomon Greene
REALTOR® Keller Williams Realty Atlanta Partners
(678) 775-2677

Timeline to Home Ownership - Three Months

Ninety days may seem to be sufficient time to find and close on a Metro Atlanta property. In fact, there are several steps involved in the process, including finding an acceptable property, getting an offer accepted, surviving all contingencies, lender underwriting and finally getting to settlement. An experienced real estate buyer’s agent can limit surprises while helping the buyer to the closing table all along the way, but is of even greater importance at this point. Residential agents will help with the search, negotiate offer terms, manage deadlines and otherwise protect the buyer’s rights during this unsettling time. The following steps represent an overview of some of the most important steps to be considered by those who plan to purchase using a mortgage.

Get Pre-approved – The home buying process should formally start with an approval from a direct lender so that all parties can benefit from a mutual win. Buyers must also consider the monthly payment that will best meet their needs, which is often less than their approval amount. Contact a real estate agent who knows how to figure the monthly payments for suggestions on good mortgage lenders and the typical documents needed for approval.

Mind the Finances – The mortgage lender will evaluate all financial statements for the 90 days prior to closing and will review credit reports again just before settlement so it is important to continue meeting financial obligations as promised. Avoid checking account overdrafts, moving around funds, making any unusual deposits or purchases during this critical time and obtain receipts for any purchases that might require an explanation.

For those with No Credit – Home ownership may be available to potential buyers without traditional credit history. Gather 12 months of rental payment receipts, utility and cell phone bills and proof of monthly payment for insurance and start contacting direct lenders.
Step Up the Search – The time has arrived to significantly enhance the search. Getting to the closing table can take up to 60 days after an offer has been accepted and buyers should have enough time to safely terminate the contract should that be desired. Flexibility is key at this point, so consider reviewing the emphasis placed on requested seller concessions and focus on well-priced individually-owned properties, foreclosures and approved short sales, making offers on multiple properties along the way.

Check the Lease – Remember that the mortgage lender will review credit histories once more prior to closing and the appearance of a housing related collections will stop settlement. Know the amount of time required to provide notice of any intent to move. Some sellers tend to be less cooperative as the closing date approaches, so determine if renting on a month-to-month basis is an option in case the need arises very late in the process to terminate the contract.

"Like" Metro Atlanta Down Payment Assistance on Facebook and be notified of new posts on first home buyer programs and more.

Solomon Greene
REALTOR® / HUD-certified Affordable Housing Counselor - Keller Williams Realty Atlanta Partners
(678) 775-2677 (Contact Me)

Timeline to Home Ownership - Six Months

Properties listed as short sales make up a large share of the Metro Atlanta housing market, but they often require several months to close. As a result, buyers with limited time often miss the opportunity to purchase the most highly desirable properties at discounted prices. If previously recommended steps have been executed successfully or the determination has otherwise been made that the time is right, leverage more of the benefits offered by this market and tour a few short sale properties over next few months. Here are a few ideas to consider.

Attend a Home Buying Class – Credit and income eligible borrowers must present the certificate of completion from an acceptable home buying class (of up to 12 hours) in order to obtain some forms of down payment assistance. Affordable, HUD-certified pre-purchase counseling classes are offered online and at venues throughout Metropolitan Atlanta, both on weeknights and weekends. Topics covered in these classes include budgeting, credit, mortgage applications, searching for a property and more.

Get an Initial Approval – Lenders are asking for more documentation before providing pre-approval letters and time will be needed to gather those documents. Submit a more competitive offer and reduce the time required for approvals by including an endorsement letter from a direct lender. Then work with an agent to take greater advantage of the vast inventory of properties on the Metro Atlanta real estate market.

Get Property Alerts by Email – Highly desirable properties will sell quickly, sometimes the same day of entry in MLS. Beat the competition to these listings by asking an agent to set up automatic email alerts with the two local MLS services that will send a notice when the ideal property hits the market.

Meet with Program Administrators – Gwinnett County and other down payment assistance program administrators require that those who use their programs meet in person with them to confirm all documents are in order.

"Like" Metro Atlanta Down Payment Assistance on Facebook and be notified of new posts on first home buyer programs and more.

Solomon Greene
REALTOR® / HUD-certified Affordable Housing Counselor - Keller Williams Realty Atlanta Partners
(678) 775-2677 (Contact Me)
AtlantaDownPaymentAssistance.com

Timeline to Home Ownership - Nine Months

On the surface, nine months may seem to be far too early to be planning the purchase of a property. In reality, the resolution of some matters will require significant planning time. Limit last minute surprises and increase the likelihood of a successful closing by following through with some important details early.

Review Credit History – Confirm that all entries on personal credit reports are timely, accurate and contact creditors in writing (ideally through certified mail) to address any reporting errors over the most recent two years (open disputes appearing on credit reports will likely prevent loan approval). Be mindful that federal debts and some bankruptcy entries will likely appear in credit histories beyond seven years, but their presence alone may not prevent mortgage approval. While minor, non-housing related collections may be OK, the presence of recent or un-discharged bankruptcies, unsettled tax liens, other federal debts in default, and housing related collections (including lease breaks) in one’s credit history will be barriers to mortgage approval, regardless of their age. Those looking to use down payment assistance through the State of Georgia may not have had any bankruptcies or judgments over the past three years.

Gather Tax Returns – Locate tax returns and W-2s for the previous three years. Request tax transcripts from the IRS for years that cannot be found (for a fee) and allow sufficient time for a response.

Obtain Closing Funds – Borrowers who plan to obtain the funds required of them to close from friends or family should consider depositing them into their personal accounts at least nine months before contacting a lender for approval. Borrowers are encouraged to work with their lender regarding deposits made into their accounts within 90 days of settlement so that strict guidelines regarding gifts may be followed.

Manage Accounts - The borrower should expect their financial statements to be under scrutiny in the coming months. A single checking account overdraft, returned check or other costly line item could suggest to an underwriter that the borrower is unable to manage money. Review financial statements, identify and address any issues that may have led to costly financial outcomes in the past so that financial statements will not become a barrier to the dream of home ownership.

"Like" Metro Atlanta Down Payment Assistance on Facebook and be notified of new posts on first home buyer programs and more.

Solomon Greene
REALTOR® / HUD-certified Affordable Housing Counselor - Keller Williams Realty Atlanta Partners
(678) 775-2677 (Contact Me)

Timeline to Home Ownership - Twelve Months

Frequent readers of the Atlanta Down Payment Assistance blog should already know about the many initial expenses associated with the purchase of a property that are not typically covered by most first time home buyer programs. This passage focuses on the importance of savings in the mortgage approval process and describes how other first home owners managed to save the funds required to successfully close on the purchase of and maintain their properties.

Establish a Pattern of Savings – A monthly contribution to savings over a twelve month period will strengthen the borrower’s chances of loan approval, and two months of cash reserves outside of retirement accounts are now required of anyone who’s planning to use the State of Georgia Down Payment Assistance Programs (only). Of course, those who are not pursuing down payment assistance must consider the down payment, closing costs and fees paid outside of settlement while all home buyers should be prepared to address the property repairs associated with home ownership. The higher costs of living, incidental expenses and other life challenges, however, apply pressure on one’s ability to save, often leading to deficit spending and increased credit card balances. These obstacles can be overcome over time for many with disciplined habit changes.

How have others managed to save the funds required to buy and maintain their homes? A survey by the National Association of REALTORS® 2010 Profile of Home Buyers and Sellers revealed some interesting information about the sacrifices made by first time home buyers who successfully closed on the purchase of their homes.

• 41% cut spending on luxury or non-essential items
• 23% cut spending on entertainment
• 26% cut spending on clothing
• 15% cancelled vacation plans
• 9% earned extra income through a second job
• 6% sold a vehicle or decided not to buy one
  

The report also revealed that singles were more likely than non-singles to live with family or friends before buying, another option that may be available to renters. Regardless, borrowers should use the time available to give themselves an additional edge in the mortgage qualification process by making savings a priority, both now and after the purchase of a property.

Maintain Good Rental History – Those planning to take advantage of down payment assistance through the State of Georgia must establish and maintain an acceptable and verifiable rental history for twelve months.

"Like" Metro Atlanta Down Payment Assistance on Facebook and be notified of new posts on first home buyer programs and more.

Solomon Greene
REALTOR® / HUD-certified Affordable Housing Counselor - Keller Williams Realty Atlanta Partners
Metro Atlanta Down Payment Assistance
(678) 775-2677 (Contact Me)