Housing Bill Shuts Down Non-Profit Downpayment Assistance Programs on October 1, 2008. Take Action Today to Save Downpayment Assistance!
Nehemiah Corporation of America, a national non-profit organization, has helped over 300,000 families who would have otherwise been locked out of homeownership due to lack of downpayment funds.
Both the House and Senate passed H.R. 3221, Housing and Economic Recovery Act of 2008, a comprehensive piece of legislation that addresses a variety of housing related issues. The bill contains a provision (SEC. 2113) that forbids FHA from insuring mortgages in which the borrower’s downpayment comes from a private downpayment assistance provider, beginning October 1, 2008. As of this date, the minimum downpayment will be increased from 3% to 3.5%.
The bill is headed for the President’s desk where his prompt signature is expected. With the stroke of the President’s pen, downpayment assistance will be shut down in the United States on October 1, 2008.
The consequences will be devastating! By FHA’s own estimates, DPA comprises nearly 40% of FHA’s volume. This means more than 300,000 working class families will be locked out of homeownership in the next year alone. Communities across America will take the brunt of the $50 billion in lost real estate sales, not to mention the indirect impact on the real estate, mortgage and building sectors that will be forced to shed tens of thousands of jobs due to this dangerous legislation.
Act Now! Contact your elected officials and urge them to introduce and pass a bill that allows downpayment assistance to endure. Failure to act now will ensure the death of all private downpayment assistance programs. www.getdownpayment.com
Thomas Wheatley, Creative Loafing – Published 07.30.08
Before the Beltline can unite and connect Atlanta, it first has to experience Atlanta’s tale of two cities.
Visit a study group north of I-20, say near Buckhead and Tanyard Creek, and residents fume about bike-trail paths. Venture down to Metropolitan Parkway and in southwest Atlanta, and you hear pleas for economic development, jobs and, most importantly, attention.
Which is why last week’s decision by Beltline leaders to spend almost half of the $98 million in initial bond proceeds to pay for a sliver of land in northeast Atlanta has many concerned that all the benefits of the Beltline are going to be felt north of I-20.
Even the advisory committee formed to oversee Atlanta Beltline Inc. is critical of the decision.
“Based on our assessment of what the Beltline wants to do, there is no equitability in the allocation of those dollars when you’re going to use 80 percent of it in the northeast quadrant,” says Eugene Bowens, chairman of Tax Allocation District Advisory Committee.
At issue is a 4.5-mile stretch of land owned by Gwinnett County developer Wayne Mason and his son, Keith. The Masons purchased the land near Monroe Drive and Piedmont Road for $26.5 million in 2004, and announced plans to build two high-rise towers. The Masons also promised to donate their railroad right-of-way to the Beltline project.
But opposition from the neighborhood led the city to reject the Mason plan. The Masons, in turn, accused the city of refusing to negotiate a compromise that would have made both sides happy. In the end, the Masons walked away from the deal, taking a vital piece of the Beltline with them.
They later worked out an agreement for Atlanta Beltline Inc. – the nonprofit group in charge of coordinating and planning the massive project – to purchase the property for $66 million, nearly a 200 percent profit.
The Beltline group made an initial $21 million payment to the Masons, and the rest of the note is due Oct. 31.
Terri Montague, CEO of Atlanta Beltline Inc., says the nonprofit has no choice but to use $45 million of the money received from the Tax Allocation District created for the Beltline to complete the sale. The Beltline group has to snag at least two of the four right-of-way segments to be eligible for sorely needed federal funding. Currently, it holds the title to only one.
Before the deal can be completed, it has to go before Atlanta City Council. Councilwoman Mary Norwood says she’s disappointed the Masons won’t restructure the deal for a longer term. The advisory committee overseeing the Beltline made the same recommendation.
“I’m hopeful that between now and the time the closing happens, the Masons will decide they won’t need to have all their money in 2008,” Norwood, who is a candidate for mayor, says. “When you look at everything from the Olympics to Grady Hospital, people make decisions all the time that help the greater good of the city and the region.”
Montague says the Beltline partnership tried unsuccessfully to convince the Masons to give them more flexibility.
“In March and April, ABI repeatedly requested to restructure or defer Northeast [corridor] loan payments and the Masons declined to do that unless ABI put up a $45 million line of credit” as collateral, Montague said through a Beltline representative.
Jane Langley, a spokeswoman for the Masons, denies Montague’s statement, saying they never received a formal request to restructure the deal. She declined to say whether the Masons would agree to renegotiate. “I’m not going to speculate on that,” Langley says. “The joint venture has honored all their obligations to date and we expect them to do so.”
The larger issue, according to the Beltline advisory committee, was the Beltline’s decision to purchase the entire Mason property rather than just the railroad easements. They argue that it was an unwise business decision in today’s real estate market.
Bowens also says the Beltline partnership excluded his group from the decision-making process even though it is required by law to seek the advisory committee’s input on the spending of any TAD money.
“We did not have the opportunity to make recommendations in that regard,” he says. “We found out about it after the fact, and that’s not the way that’s supposed to happen. If we are going to be advisers, then call upon us. Give us the opportunity to advise you.”
A Beltline representative says the group was briefed prior to the negotiations.
At this point, Montague says, the Beltline is in a damned-if-you-do and damned-if-you-don’t situation.
If it doesn’t follow through and purchase the Mason property now, it would go into foreclosure; the Beltline has already paid $26 million, plus monthly $450,000 interest payments since March.
And a foreclosure would only complicate the situation, forcing the city to condemn the property to obtain the right-of-way. “We’d be looking at two to three years of litigation that every attorney we’ve consulted has said we’d lose,” Montague says.
City Council is expected to vote on the allocations of Beltline TAD funds in late August. The council will also vote on an affordable-housing board’s list of recommendations as to what type of strategies should be used along the 22-mile project – a Beltline component that is required by law – at that time as well.
These difficult decisions are all thanks to a Georgia Supreme Court decision in February that ruled the state’s process for TADs is unconstitutional. It didn’t affect the money already received by the Beltline and other TAD projects. But to obtain additional funding, voters statewide must approve a referendum in November.
If not, Montague says, the Beltline will have to find other ways to be built, such as ramping up efforts for private contribution or even extending the lifespan of the original TAD.
And in doing so, the timeline of the project would slow to a crawl.
Norwood thinks appealing to the philanthropic side of the Masons could be the key. “At the end of the day, this is not about the city government,” she says. “This is one of the biggest urban greenspace developments in the country. It’s become larger than ‘we’re annoyed with the way the city government treated us.'”
Earlier today President Bush signed into law a number of very significant changes that will occur starting October 1st. Please read these changes as they affect all of us and our Home buying abilities.
Details of the Housing and Economic Recovery Act are as follows:
The two items in bold will have the greatest immediate impact so please read these carefully.
Higher permanent loan limits for conventional conforming and FHA loans will become EFFECTIVE January 1, 2009. The act calls for limits to increase to a maximum amount of 625,500 , depending on the metropolitan area. The temporary limits established in March 2008 are set to expire December 31, 2008
-FHA floor limit to remain at 271, 500
-VA guaranty will increase
**Minimum cash investment for FHA loans WILL increase to 3.5%**
-A moratorium on RISK Based Pricing for FHA loans will go into effect on October 1, 2008
**SellerFunded Down Payment Assistance with FHA loans will be TERMINATED on October 1, 2008. No more DPAs like Nehemiah & American Dream.**
-Condo processing for FHA loans will be streamlined
National Night Out is next Tuesday – August 5th. HERE nno-westview-flyer is the flyer for the event. Please feel free to print it out and pass them around to your neighbors. The document is setup to print two per page.
There will be food, music, and public safety awareness. The event will be held in the Denny’s parking lot from 6-8pm.
If you are interested in shopping for quality gently worn children’s and maternity clothing, the sale hours are:
Saturday, September 20th, 9:00am-6:00pm
Sunday, September 21st, 1:00pm – 4:00pmIf you would like to make money from your children’s clothing and accessories or unwanted maternity clothes, the Consignors Drop off is:
Thursday, September 18th, 5:00pm-8:00pm
Friday, September 19th, 5:00pm-8:00pm
This home was featured in our 2008 Tour of Homes. The owner is relocating! Spacious 3bed/2bath Bungalow on Peeples Street! Much character (Pocket doors) and everything we love about Peeples Street i.e. Iron fence, rocking chair front porch. List price 300K
The quirky homes sell for as much as $600,000, despite the fact that they range in size from just 800 square feet to 1,500 square feet.
Chapin uses clever design tricks, such as corner windows and skylights, to give the illusion of more space. He also makes the most of every inch by including crawlspace storage and built-in bookshelves and cubbies.
“These days, we drive to the house, open the garage door, go in,” Indianapolis developer Casey Land told the Wall Street Journal. “But it’s important to get to know your neighbors. I think people miss that.”
Source: Wall Street Journal, Sara Lin (07/18/08..)