Has anyone used the NACA program to purchase a home? It appears to be a good program if it is as they claim. NACA supposedly does not require PMI, down payment, or closing costs. You do have to have $2000.00 savings for escrow to pay for one year of home insurance and other pre-paid items. In addition, they also claim prime lending rates for people with lower FICO scores who would otherwise receive higher rates. The only catch that I see is the required counseling, and you have to pay $3000 to a fund to help others which is payable at $50/month for 5 years. Supposedly there are no other costs involved. There are other eligibility requirements that must be met as well.
I should receive all of this in writing within the next few days, but this is all I know at the time and the information on the website is limited at best.
Anyone used NACA or knows someone who has? Good or Bad?
NACA Program
Started by
adenisecarr
, Jun 17 2003 08:16 PM
8 replies to this topic
#1
Posted 17 June 2003 - 08:16 PM
#2
Posted 18 June 2003 - 01:30 AM
It is a glorified gifting program. The programs that they are talking about are conforming programs that allow you in a home much easier if you are willing to buy a home in a "depressed" area and have a certain level of income that is normally lower then the median income of that particular area. Like I said, these programs are available for every broker, it is just they have turned the "gifting" into a "program" and allowed YOU and not the SELLER to pay for the gift...which is actually still your money. Very good way to package it though...marketing at it's best. 8)
#3
Posted 18 June 2003 - 08:31 AM
My husband and I are currently going through the program and have a 3rd appointment to present financial papers for qualification on June 27. Reason for 3rd appointment is I needed to clean up identity theft items that appeared at the last minute on my credit report.
We are only using my salary, as husband has some outstanding issues on his credit report. My salary is $65K and based on my monthly savings and current rent I can purchase a home with a mortgage up to $1,500, which should put me right in the $250K range. Reserves required include $5,000+2 months mortgage payment ($8,200). Was told by the counselor that she doubted I would use even 1/4 of the reserves, particularly if the seller kicks in closing assistance. The program is legit, is all that they claim, and more. Benefits include:
--No closing costs (you are required to pay prepaids)
--No down payment (seller's may require earnest money deposit)
--No PMI
--Everyone receives Mortgage Rate 1% below prime rate and is not score driven (yes, even if your score is 500, as long as you have had on time rent payments, installment payments, credit card payments in the past 12 months you qualify; so no lates in past 12 months)
--Anyone can participate including consumers with paid charge offs, bankruptcies (not sure of requirements), paid tax liens, paid judgments
--No Income restrictions
--Neighborhood Stabilization Fund of $3,000 [if you become unemployed and can't pay your mortgage, the NSF is there to assist you for approximately 6 months (I think) in meeting your mortgage]
--Maximum house that can be purchased is based on the prices in your area.
--Mortgage will be received through BofA, Fleet, or First Union only
If your income is below the median level, you are qualified to purchase anywhere you choose. If your income is above the median level, home has to be within designated area (the priority area). For the Washington DC metro area, the priority area includes the entire city of Washington, DC as well as cities/towns/provinces within the beltway, plus up and coming booming areas such as Fort Washington, Greater Upper Marlboro, and Bowie. None of which are depressed areas and all have new homes selling minimum of upper $300,000+.
Girlfriend went through the program and highly recommends it. She currently resides in Fort Washington in a beautiful home on an 1/2 acre lot. At the time of her purchase, she was only required to have $3,000 in reserves; did not pay any closing costs; used sellers closing assistance funds to pay all prepaids; brought down the mortgage rate with the seller's closing assistance funds; and received her earnest money back at closing. The deal cost her $0.00 at closing. Home was purchased in December 2001 and she currently has over $50K in equity since her purchase. Friends of friends have wanted to go through the program, but became impatient and chose to purchase a home without NACA's assistance.
The only draw back to NACA, is that the program is becoming more and more popular. Therefore, it takes time to get an appointment. Basically, what it all boils down to if you have the time and patience and the desire to get all the benefits as mentioned above, NACA is worth the wait and patience that you will learn.
If this is truly classified as a gift program, then I sincerely hope that Christmas will come to me in July or August, with a nice big red bow.
We are only using my salary, as husband has some outstanding issues on his credit report. My salary is $65K and based on my monthly savings and current rent I can purchase a home with a mortgage up to $1,500, which should put me right in the $250K range. Reserves required include $5,000+2 months mortgage payment ($8,200). Was told by the counselor that she doubted I would use even 1/4 of the reserves, particularly if the seller kicks in closing assistance. The program is legit, is all that they claim, and more. Benefits include:
--No closing costs (you are required to pay prepaids)
--No down payment (seller's may require earnest money deposit)
--No PMI
--Everyone receives Mortgage Rate 1% below prime rate and is not score driven (yes, even if your score is 500, as long as you have had on time rent payments, installment payments, credit card payments in the past 12 months you qualify; so no lates in past 12 months)
--Anyone can participate including consumers with paid charge offs, bankruptcies (not sure of requirements), paid tax liens, paid judgments
--No Income restrictions
--Neighborhood Stabilization Fund of $3,000 [if you become unemployed and can't pay your mortgage, the NSF is there to assist you for approximately 6 months (I think) in meeting your mortgage]
--Maximum house that can be purchased is based on the prices in your area.
--Mortgage will be received through BofA, Fleet, or First Union only
If your income is below the median level, you are qualified to purchase anywhere you choose. If your income is above the median level, home has to be within designated area (the priority area). For the Washington DC metro area, the priority area includes the entire city of Washington, DC as well as cities/towns/provinces within the beltway, plus up and coming booming areas such as Fort Washington, Greater Upper Marlboro, and Bowie. None of which are depressed areas and all have new homes selling minimum of upper $300,000+.
Girlfriend went through the program and highly recommends it. She currently resides in Fort Washington in a beautiful home on an 1/2 acre lot. At the time of her purchase, she was only required to have $3,000 in reserves; did not pay any closing costs; used sellers closing assistance funds to pay all prepaids; brought down the mortgage rate with the seller's closing assistance funds; and received her earnest money back at closing. The deal cost her $0.00 at closing. Home was purchased in December 2001 and she currently has over $50K in equity since her purchase. Friends of friends have wanted to go through the program, but became impatient and chose to purchase a home without NACA's assistance.
The only draw back to NACA, is that the program is becoming more and more popular. Therefore, it takes time to get an appointment. Basically, what it all boils down to if you have the time and patience and the desire to get all the benefits as mentioned above, NACA is worth the wait and patience that you will learn.
If this is truly classified as a gift program, then I sincerely hope that Christmas will come to me in July or August, with a nice big red bow.
#4
Posted 18 June 2003 - 10:47 AM
Thanks Focused, this is all new to me and your information was truly helpful. Regarding your friend, you indicated she used the sellers closing assistance fund to pay for her prepaid. Can you give me a little more information how her assistance program worked and are you planning to do the same?
Willtygart, you don’t sound pleased with the program. Where did you obtain your information, and how much research have you done on the program? As you can see, I have given raving reviews by Focused and she seem to have lots of fact, don’t get me wrong but your opinion appears to be just that an opinion. I’m looking for facts as you know them or were told by someone using/considered the program.
Willtygart, you don’t sound pleased with the program. Where did you obtain your information, and how much research have you done on the program? As you can see, I have given raving reviews by Focused and she seem to have lots of fact, don’t get me wrong but your opinion appears to be just that an opinion. I’m looking for facts as you know them or were told by someone using/considered the program.
#5
Posted 18 June 2003 - 12:33 PM
What I am saying is yes, this is a good program...do they have a corner on the market...NO....This is a B of A wholesale program as well. Finding the gifting for the down and the reserve requirements can be done by a broker as well. This is a legite program but it is just packaged in a different marketing way. I can also get someone into the home with no closing costs and seller contribution to closing. There was some question off of the board as o whether or not I knew enough about this program to make a judgement on it and all I am trying to say is this program (once again) is the SAME program that is offered by my wholesale lender. The only difference is the couseling and the way that the gifted money is packaged. :shock:
#6
Posted 18 June 2003 - 03:08 PM
Basically, the seller was willing to pay XX% of my friend’s closing costs. Since the NACA program is closing cost free (unbeknownst to the seller), she used a portion of the funds the seller was willing to contribute to cover her out of pocket prepaids. Basically, at closing she was reimbursed for all out of pocket pre-paid expenses, including earnest money.
It is my hopes that we can purchase a home in which the seller will be providing closing assistance. In the event that the seller does agree to contribute, I do intend to use the seller’s contribution for reimbursement of my out of pocket prepaids and buy down the interest rate. I also intend to request matching gift funds (which is allowed) from the non-profits such as Genesis or AmeriDream or the Hart Program (basically whoever). My intention will be to use these funds to buy the mortgage rate even further (if allowed). If any is left over and I’m not sure that there will be (or even if I can do it), I would like the rest to be applied against the overall mortgage. This is a question a plan to present on June 27.
If there is any doubt as to closing costs, I would like to be clear that the mortgage comes with $0.00 closing costs (outside of prepaids). As there are no closing costs; therefore no closing costs are not rolled into the loan.
It is my hopes that we can purchase a home in which the seller will be providing closing assistance. In the event that the seller does agree to contribute, I do intend to use the seller’s contribution for reimbursement of my out of pocket prepaids and buy down the interest rate. I also intend to request matching gift funds (which is allowed) from the non-profits such as Genesis or AmeriDream or the Hart Program (basically whoever). My intention will be to use these funds to buy the mortgage rate even further (if allowed). If any is left over and I’m not sure that there will be (or even if I can do it), I would like the rest to be applied against the overall mortgage. This is a question a plan to present on June 27.
If there is any doubt as to closing costs, I would like to be clear that the mortgage comes with $0.00 closing costs (outside of prepaids). As there are no closing costs; therefore no closing costs are not rolled into the loan.
#7
Posted 18 June 2003 - 04:43 PM
There are no closing costs but you do have to pay the 3000 back over a specific amount of time correct?
#8
Posted 19 June 2003 - 07:23 AM
Yes, you have to pay the 3,000 back over the course of 5 years at $50.00 per month which is included in the mortgage and is tax deductible. The $3,000 NSF is designated to help members that participate in the NACA program who are in danger of losing their home due to unemployment or other dire circumstances.
In my opinion, it's a small price to pay over a short period of time for all the benefits you get with this program, particularly since this $3,000 NSF may ultimately benefit me in the long run (although I sincerely hope not).
In my opinion, it's a small price to pay over a short period of time for all the benefits you get with this program, particularly since this $3,000 NSF may ultimately benefit me in the long run (although I sincerely hope not).
#9
Posted 19 June 2003 - 11:47 AM
I won't argue anymore........white flag is up. I do not see the difference in charging you 3000 in fees and then letting you pay them back to me outside of closing over time. The mortgage payment protection sounds like its a policy that you can pay as was....lots of companies allow you to pay a small fee (which could be included in the loan) to do this. If you are happy with it then I am happy for you. I never said it wasn;t a good program I just stated that is was a hybrid of what brokers can do and it is a really good way to package a certain program. Good Luck 
0 user(s) are reading this topic
0 members, 0 guests, 0 anonymous users
