Downpayment Assistance Exec Says 'It Is Not Over'

Sacramento, CA — September 11, 2008
By: Amilda Dymi, Origination News

SACRAMENTO, CA -- The signing into law of a housing bill, which among other measures is designed to improve the performance of Federal Housing Administration loans and bans seller-funded downpayment assistance, looks like the end of the ride for DPAs. Not so, an industry representative says. "It is not over!"

"We have just begun the fight," Scott Syphax, president and CEO of the Nehemiah Corp. of America, the country's pioneer in providing downpayment assistance, told ON. "We will continue on."

The statement, however, does not pertain merely to the fact that as a diversified affordable housing organization Nehemiah will continue to operate in the marketplace offering various financial services. "We are not ending our fight for downpayment assistance, or for the hopes of working-class families everywhere seeking to be homebuyers. We are going to redouble our efforts," he said.

As to what Mr. Syphax plans to do next and where does his optimism come from, the executive said he believes there is potential in campaigning to spread the word among future homebuyers, as well as in providing new research data that through numbers will explain DPA to skeptics.

"This provision of the housing bill was buried to the majority of the American people in the panic over the potential failure of large institutions, so [DPA] got left behind in the discussion," Mr. Syphax said. "But now is the morning after. So we are going to speak far and wide across the United States, in every city and town that we can touch letting people know how this is going to impact not only the working families that we serve, but the community organizations, governmental organizations, and the local real estate communities who depend on downpayment assistance in order to put families into single-family homeownership."

Asked whether his hopes for a comeback of the DPA industry are based in the upcoming change of the administration after the presidential elections in November, he said there certainly is potential "for a great deal" of change. "We will work to make that change happen."

More than anything, to Mr. Syphax this is a cause worth fighting for. "We were the last remaining safety net. The collateral damage to local communities across the country is only now beginning to be calculated."

Mr. Syphax agrees that misperceptions about DPAs have played a role in the resentment of the program. One example, he said, is the idea that homebuilders are the biggest beneficiaries here, not homebuyers. In fact, DPA is based on transactions on previously built homes.

In a recent letter to President Bush, Nehemiah stressed that the elimination of DPA programs "will negatively impact generations to come," ignoring the fact that seller-funded DPA is the only remaining safety net available to millions of families today seeking homeownership. HUD spent over 10 years fighting to shut DPAs down, Nehemiah said, "rather than work with us to determine how to improve a downpayment assistance program that has helped more than one million American families." The program is credited for helping over one million African-American, Hispanic, female-headed and low- to moderate-income families over the last decade. It has generated nearly $10 billion in home equity for those families between 2000 and 2005. No wonder HUD received over 14,000 supporting letters from families and individuals in 2007 and another 17,000 letters in 2008. The ban slams the door on 100,000 aspiring homeowners every year by eliminating a program that works without using taxpayer dollars, said Ann Ashburn, president of AmeriDream Inc., Gaithersburg, Md., in a press release.

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For additional information, please contact Shelley Mitchell, smitchell@nehemiahcorp.org, 916-231-1999.

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