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April 2007


Welcome To AmeriDream’s Newsletter

In This Issue:

  • Ask AmeriDream
  • Homebuyer Education - Appraisal 101
  • Abundance of Housing Gives Buyers Upper Hand
  • AmeriDream Addresses National Community
    Reinvestment Coalition

Q: What's good about FHA Moderization Legislation?

A: Families, who want to share in the dream of homeownership, but have less than perfect credit, need and deserve a safe option. FHA modernization legislation has the opportunity, if done right, for millions of Americans by offering them safe homeownership options at a fair price.

Q: What’s bad about FHA Modernization Legislation?

A: As it currently stands, the FHA Modernization Act could hurt the very people the FHA seeks to help. Their “risk-based pricing” and 103% LTV proposal will essentially turn the government into a provider of the same sub-prime loans HUD seeks to defeat. Consumers also need to know that risk-based pricing is a tax.

Q: What are your recommendations to FHA Modernization Legislation?

A: Take out this financing proposal of “risk-based pricing” that taxes the consumer and the 103% LTV proposal allowing homebuyers to have a mortgage that knowingly exceeds the appraised value. Eliminate these two proposals and you have a solid piece of legislation. We applaud the plan to increase loan limits to make FHA financing a viable option in higher cost areas, and the proposal to stretch loan terms to make homeownership more affordable. These are options Americans need to grab their piece of the American dream.

Appraisal 101

An appraisal is the homebuyer’s best protection to avoid paying more than a home is worth.

A component of virtually every mortgage process is the appraisal, which is an estimate of the value of the home you are purchasing. Appraisals are conducted by a professional appraiser who visits the home and inspects the size, condition, quality and function of the home.

The appraiser will create a detailed report and will generally use comparisons to the sale prices of similar homes in the area to determine a value of the home that is being appraised. Comparisons can be made to square footage, appearance, amenities, and the overall condition.

A professional appraiser protects both the buyer and lender. Buyers are protected from paying too much and lenders are protected from lending more than the property is worth.

For more information about the home appraisal process, talk with your real estate agent or lender.

With an abundance of homes for sale in most of the country, buyers continue to have plenty of choices and lots of bargaining power.

Unlike the days in a hot housing market where multiple contracts were the norm, sellers now feel less pressure to decide quickly on whether or not to buy. Most are betting that prices won't rise in the near term and could fall further. Sellers should expect buyers to take their time and be tougher negotiators.

The good news for home sellers is that unemployment remains low in most areas and wages are growing. Mortgage interest rates are still low, allowing people with good credit records to obtain 30-year fixed-rate loans at a good rate.

AmeriDream President Ann Ashburn was featured as a panelist in a discussion of innovative approaches for affordable housing at the annual national conference of the National Community Reinvestment Coalition, held March 14-17 at the Hyatt Regency Capitol Hill Hotel in Washington, DC.

Ms. Ashburn presented information about nonprofit organizations that provide down payment assistance and how these organizations help low-and-moderate income individuals and families become homeowners.

“Often, people don’t quite understand how these nonprofit organizations work, and there is a lot of misperception,” Ms. Ashburn comment. “Workshops like this one, gives us an opportunity to correct these myths and highlight the work we are doing to help underserved groups become successful homeowners.”

NCRC is a national nonprofit membership organization that promotes economic justice and equal access to credit, capital and financial services to traditionally underserved communities.

In addition to Ms. Ashburn, other panelists included: Janice Bowdler, National Council of La Raza; Gail Burks, the Nevada Fair Housing Center; Alan Fishbein , Consumer Federation of America; and Robert Stupp, Baltimore Community Law.

(Click here to view Ms. Ashburn’s presentation.)

“I never thought I could buy a home until I found out about AmeriDream. My whole outlook on life has changed. I am more optimistic on what I can achieve in life. I am proud to be a homeowner. AmeriDream is a fantastic program.”

Mariana in Tampa, FL

Can you correctly answer the following questions. (Hint - the answer is right in front of you.)

The beginning of eternity
The end of time and space
The beginning of every end,
And the end of every place

- Solution is located on the bottom of the page -

To look up your AmeriDream Representative

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Toll Free: (866) 263-7437 | (866) AMERIDREAM | www.ameridream.org

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