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The Community
Home Buyers Program (CHBP) is a special program available
through the Federal National Mortgage Association (FNMA),
or Fannie Mae, which
is a federally chartered corporation that purchases conventional
and government-guaranteed real estate loans; it is also the
world's largest home loan investor.
With
the FNMA program, you need to save only 3 percent, or $3000
on a $100,000
sales price. The rest of the money you need for closing can
come from a gift from
relatives or a nonprofit organization or some sort of state
or local government program
in the form of a grant. The program is designed for low- to
moderate-income families.
The program allows you to purchase more home because the qualifying
ratios are
eased.
This
lower down payment conventional loan can compete with the
most popular
first-time homebuyer loan (FHA). The Federal Housing Administration
(FHA) is a
division of the Department of Housing and Urban Development
(HUD) whose main activity is to insure residential real estate
loans made by lenders. It sets standards
for construction and underwriting. The FHA neither lends money
nor plans or
constructs houses.
The CHBP
has one catch, however. You must take a special educational
course on
preparing for home ownership. This course will include such
things as analyzing your
current expenses, how to negotiate your contract, what to
expect from the loan
company, and life as a homeowner. It's a very useful course,
and everyone should
enroll in it. Call your lender for further details.
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