It appears that a deal has been made to save FHA down payment assistance programs with seller participation. I have always said we should fight not to throw out the baby with the bath water when it comes to these programs. All we need to do in order to lower the foreclosure claim rates on loans with seller participating down payment assistance is to enforce the rest of the FHA underwriting guidelines.

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There’s a huge debate going on right now about seller assisted down payment programs on FHA insured loans. Most of the program’s detractors are those who are on the outside looking in. The objections of those opposed to seller assisted down payment programs are not completely without merit. There have been some problems in the implementation of the program which have led to a higher than necessary foreclosure rate among those borrowers using the program. And yet foreclosure rates

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