Government restores funding for zero-down home loan program

CAJ note: Uh, isn’t this one of the root causes of our current economic crisis?

Cami Reister
The Grand Rapids Press
8/13/2010

Zero-down financing for some home buyers will return after funding was restored to a federal loan guarantee that has been broke since April.

The U.S. Department of Agriculture’s Rural Development program provides guarantees to 30-year, fixed-rate mortgages at market rates offered to moderate income buyers.

The loans require no down payment and have no monthly mortgage insurance premiums — almost unheard of in today’s credit climate.

“It will be welcomed back with open arms,” said Dan Grzywacz of Exchange Financial Mortgage in Kentwood. Before the funds dried up, the program comprised 10 percent of his company’s business.

“With the tightening of credit, people have migrated to this program as one of the remaining zero-down programs available.”

President Obama signed a bill at the end of July restoring funds to the program and increasing some fees as a means to make it more self-sufficient…

Read the rest at MLive.com

Read also How Politicians and Regulators Caused the Sub-Prime Financial Crisis of 2007 and the Subsequent Crash of the Global Financial System in 2008, and Likely Will Again.

Both articles H/T theblogprof

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