Praising God and denouncing the enemies of seller-funded down payment assistance, Nehemiah Corp.'s CEO Scott Syphax pleaded with 8,800 teleconference listeners Wednesday, Sept. 17, to continue their work to resurrect it from the dead.
There are signs of life for the FHA program in the House of Representatives, where a bill to reinstate it passed out of the Committee on Financial Services and onto the floor on Tuesday, Sept. 16.
"This is a stunning achievement for all of you," Syphax announced with the zeal and tone of a televangelist. "What you have done is incredible. You have made yourself be heard...This is not the Nehemiah Corp.; this is all of you."
The bill still has a long way to go before becoming law. And, despite all the grass-roots pressure from groups like Nehemiah, which serve as conduits of down payment money between sellers--including home builders--and home buyers, there is still a lot of opposition. The chance of getting something passed before the program goes out of existence on Oct. 1 seems like a long shot.
HUD has denounced the program, saying it's inflationary because sellers bump up the price of the homes to account for the assistance and that there is a higher default rate among buyers who have less equity in their homes. The Bush Administration, too, has been opposed the program.
H.R. 6694, the bill now on the floor of the House of Representatives, does have some compromise ingredients designed to make it more palatable to opponents. For instance, it requires borrowers to have a FICO score of 620 or higher. Those with lower FICO scores would need to buy risk-based mortgage insurance to cover possible defaults. The premium would initially be 3% of the principal balance and roughly 1.2% of the balance later as an annual premium.
Syphax chose not to talk about those details during Wednesday's "Town Hall" teleconference; instead, he used his time to whip the crowd into attack mode and to name the program's enemies.
"We do have an adversary out there: the National Apartment Association and the Multi-Family Housing Council, because they want the families that we all serve to help the members of their association," Syphax said. "This cynical ploy is despicable."
He didn't have much nice to say about HUD either, claiming the agency is poised to make money by requiring the insurance for the loans.
"We want down payment assistance to pay its own way, but we don't want HUD attempting to make money off of this and HUD charging more than is necessary."
At least some of the teleconference's attendees had financial interests of their own at stake in reinstating down payment assistance. Some of those who asked questions were real estate agents, looking to place their clients into houses. Without the assistance program, they weren't going to be closing those deals.
"It is time for us to go on the attack," Syphax said, urging listeners to continue to call congressional representatives to lobby for reinstating the assistance program. In a new angle of attack, he also asked for them to start e-mailing in the stories of people who will miss out on homeownership without the down payment assistance, even offering an example of a family that needs to buy a new home that is wheelchair accessible for their recently-disabled child and won't be able to without down payment assistance.
"Please keep fighting," he said. "We are at the door, one last swift kick and we will kick it in, it's what everybody needs to do is march right into the door of homeownership."