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Down Payment Asssistance Program Examples
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Countless different transactions have been made with the help of a Newsong grant. Below are some examples of creative ways loan officers have helped homebuyers that have similar problems to a deal you may be working on. Call our experienced staff to help assist you in putting together deals that make sense. We’ll brainstorm solutions to help you construct more deals. |
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| 1. |
BUYER HAS NO CASH |
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Negotiate with the seller to pay all closing costs and Newsong a service fee for the grant amount. Doing so makes it possible for a borrower to get into a home with absolutely no money down. |
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| 2. |
BUYER NEEDS A SUB-PRIME LOAN |
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This is a potentially excellent way to create more business. 80-10-10 loans have been popular where the borrower can get an 80% loan but only has 10% down. The buyer can apply for a 10% grant. Another example was where the borrower obtained a 75% 1st, with a 15% second or seller carry-back and a 10% grant from Newsong. There are countless ways to structure sub-prime deals. |
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| 3. |
REDUCE OR ELIMINATE THE NEED FOR PMI ON A CONVENTIONAL LOAN |
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A borrower finds a home for $119,000 that appraises for $130,000. They have $6,500 down. An offer of $130,000 is made, with a seller service fee of $13,290. The borrower gets a grant of $13,000. What this does is make it possible for the buyer to get a 10% grant along with his 5% down, creating an 85% LTV with cheap mortgage insurance as compared to a 95% LTV had they not involved Newsong. This saves the borrower .5% per year in mortgage insurance alone. |
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