Down Payment Assistance - Missouri Bond Loans- How the bond program works in Missouri !

By
Services for Real Estate Pros with Mortgage Investment Services Corporation

MHDC is able to have down payment assistance to persons buying a home with the MHDC Bond program regardless of whether or not you are a first time home buyer in some specifice counties in Missouri. This is fantastic news because these counties are now classified as a targeted area since we had some flooding in Missouri. 

How the program works - MHDC Cash Assistance Program Example

You have a client buying a $100,000 home - we can do a FHA, VA or RD loan that would allow them to minimize their down payment and combine with the MHDC cash assistance program to minimize cash injection into the property. An example follows:

Purchase price 100,000

FHA financing - 97000  (3 % down payment) soon to be 3.5% down payment required.

leaves down payment amout of 3000.00 required - + closing costs

MHDC forgivable second -  $2,910  (3% of the loan amount not the sales price)

This is all but $90.00 of the loan amount, and it is given in the form of a forgivable second.  The forgivable second is a recorded second mortgage with 0 interest rate - and each month 1/60th is forgiven after 5 years the second is then released by the lender. This would = 2,910 / 60 or $48.50 per month.

This 48.50 is not a payment your client makes it is forgiven each month, since it is a forgiven debt the IRS says this is realized income so your client in our example would have to pay taxes on the forgiven amount each year in our example thats extra income on $582.00 or 48.50x12 months.

The closing costs in this example would be the only thing the buyer would have to come up with or the seller could pay the closing costs based on the contract negotiations.

Please note when doing this option with a VA or RD loan our loan amount is 100% and the forgivable grant would cover all of the closing costs and possibly result in the reduction of the loan amount if the forgivable second was more than closing costs.

Its a great program and we have utilized this for a number of years in targeted counties in Missouri we are seeing that this is now available whether your client is purchasing their first home or not.

**Important NOTE- anyone financing a home with tax revenue bonds will NOT be eligible to also take the $7,500 tax credit/loan in April, please note this because there could be a different loan program that we can utilize that would still enable you to do the credit.

For more information regarding this program please feel free to contact me at

417 447 7927

Darren Stewart

OakStar Bank

 

 

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Rainmaker
250,222
Kent Simpson
Tierra Antigua Realty - Downtown - Tucson, AZ
Real Estate Is About People

Good post, Darren - I hope we see more of these bond programs to help people get into homes on the affordable end!  I've been trained to help business establish Employer-Assisted Housing, but haven't seen a whole lot of response...but I think we will see more programs being offered as a benefit.

Sep 05, 2008 10:08 PM #1
Rainmaker
84,834
Darren Stewart
Mortgage Investment Services Corporation - Broken Arrow, OK

Thanks for the comment Kent I just sent you the link for this program in AZ - those of you in other states do a google search for your state- housing commission or housing authority and look for First time home buyer programs.

 

Sep 05, 2008 10:25 PM #2
Rainer
128,997
Justin Ukaoma
Vizion KC - Kansas City, MO
Kansas City Real Estate Investments

Darren is this program available in Kansas City, MO?  Jackson County if so do you know anyone I can get in contact with regarding this program?  www.vizionkc.com

Sep 05, 2008 10:37 PM #3
Anonymous
Anonymous
lashawndorsey@aol.com

GREAT JOB AT EXPLAINING ALOT OF THE INFORMATION I WAS CURRENTLY READING ,IM GOING TO TRY AND FIND A LENDER IN MY AREA WHO CAN SUPPLY ME WITH THE FORMS TO FILL. ONLY THIING IS THAT WITH SOME OF THE SITES I SAW DEADLINES, HOW DO THEY APPLY?

Dec 29, 2008 06:49 PM #4
Rainmaker
69,391
Mobile Austin Notary
Apostille/Authentication/Embassy Legalization, Notary Public, Loan Signing Agent & Process Server Services - Austin, TX
www.mobileaustinnotary.com

Sounds like a great plan. Butterfly

Feb 19, 2009 11:41 PM #5
Anonymous
Anonymous
Darren Stewart

Just an update this plan like so many things has changed, the consumer must be a first time home buyer and they are now using what is called tax cash assisted loans or T CAL - the funds are advanced to the client a second is written on the property and that is paid back by the first time home buyers cash assistance that they get when taxes are done, its like getting an advance loan on the tax assistance that they will be getting from the IRS.

Darren Stewart

Feb 20, 2009 10:46 AM #6
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Rainmaker
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Darren Stewart

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