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Judge Sets Aside Rule

GAITHERSBURG, Maryland (March 4, 2008) - AmeriDream is pleased to announce that a second federal judge has ruled that the Department of Housing and Urban Development violated federal law in adopting a regulation prohibiting seller-funded downpayment assistance. HUD has been barred from implementing this regulation since an October 2007 ruling by the U.S. District Court for the District of Columbia, in a suit filed by AmeriDream.

On February 29, 2008, a Federal Court in California also ruled against HUD, and concluded that HUD’s regulation is invalid. The Court found that HUD violated federal law by failing to explain why it reversed its favorable stance on downpayment assistance and by failing to consider reasonable alternatives to the regulation. The Court also expressed concern that some interested parties may not have participated in HUD’s rulemaking process because of a public statement by HUD Secretary Alphonso Jackson that HUD would approve the new rule regardless of critical comments it might receive. To read the entire court decision, click here.

We expect a final ruling shortly from the U.S. District Court for the District of Columbia. In the meantime, as a result of these rulings, HUD remains barred from implementing the regulation prohibiting seller-funded downpayment assistance.

“Low to moderate income homebuyers who have been struggling to achieve the American dream of homeownership are the true beneficiaries of this decision,” said Ann Ashburn.

In addition to AmeriDream, opposition to the HUD rule included members of Congress from both sides of the aisle, the Mortgage Bankers Association, the U.S. Conference of Mayors, the National Association of Counties, the National Association of Home Builders, the National Urban League, and over 14,000 individuals and families nationwide who sent comments into HUD, as well as others.

Charitable down payment assistance funded in part with seller participation has allowed homeownership to grow without using taxpayer dollars. To date, more than one million families and individuals have utilized this down payment assistance, generating nearly $10 billion in home equity between 2000 and 2005. AmeriDream has provided more than 200,000 gifts to aspiring homeowners, 80% of whom were first-time homebuyers. AmeriDream has helped educate 60,000 homebuyers through homebuyer education courses, and helped 1,200 homeowners retain their homes when confronted with mortgage difficulties, and has committed over $30 million to affordable housing development in local communities

As we all await Judge Friedman’s final ruling, we encourage you to continue working with us to help low and moderate income individuals and families purchase their own homes through the provision of downpayment assistance. Please contact your Outreach Representative or Customer Service
(or call 1-866-263-7437) for timely and professional service.

As the Gold Standard for down payment assistance, AmeriDream remains committed to continue its mission to help individuals and families that are in need of a DPA program. Please check www.ameridream.org for the latest information regarding the HUD Rule.

Again, thank you for your valuable support through this process.