Down Payment Assistance Programs Aid LendersAnn AshburnDownpayment, DPA, down payment, downpayment assistance
Lenders around the nation can benefit from using down payment
assistance (DPA) programs in the home loan process. DPAs can
provide lenders with a larger number of clients, and therefore
increase their amount of business. People who may have been turned
down for a loan due to a lack of funds can sometimes be approved
for a mortgage when using a down payment gift. By increasing the
number of eligible clients by using DPAs, lenders will increase the
amount of loan approvals and improve their business in the long
run.
Using a reputable DPA is the key to success. You should choose a
DPA that has been around for a few years and has a strong, reliable
reputation. The DPA should have knowledge of the mortgage process,
so it can work through the transaction without difficulty. The DPA
should also utilize the latest technology to keep the transaction
moving quickly, and a knowledgeable support center that can help
with any questions that arise between application to
settlement.
Lenders should also make sure that the DPA is reliable. This is
for the lender's own safety. The Federal Housing Administration
holds the lender accountable if the down payment gift doesn't come
from a reputable organization. The lender must be careful when
choosing a DPA, or else they may be saddled with the cost of the
down payment gift.
Another key factor that lenders should keep in mind is whether
or not the DPA has mortgage protection insurance affiliated with
its program, such as a mortgage payment relief program that
provides protection against the two most common threats to the
borrower's ability to payshort-term disability and involuntary
unemploymentand gives lenders greater protection when facing
defaults.
DPAs provide numerous advantages for lenders, including an
increase in business, an easy transaction and protection against
default. Furthermore, DPAs enable potential homebuyers to purchase
homes they may not have been able to otherwise, because they lacked
the lump sum necessary for a down payment. In other words, DPAs
help more people realize their dreams of homeownership.
Ann Ashburn is president and CEO of AmeriDream Inc. She may
be reached at (866) 263-7437 or e-mail
[email protected].
