OpinionIndustry News

A plan for national downpayment assistance

USDA, VA programs serve as role models

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By J. LENNOX SCOTT The federal homebuyer tax credit program provided the shot in the arm that the housing market needed to help stimulate the U.S. economy. But in the absence of a tax credit, and with increasingly stringent lending standards that require sizable downpayments, many would-be first-time homebuyers are getting squeezed out of the market. First-time buyers are critical to the overall health of the U.S. economy because their purchases stimulate a chain reaction of home sales across all price points. Furthermore, every time someone buys a home it helps strengthen the economy through associated purchases, such as furnishings, home improvement projects, and the like. It also results in thousands of dollars of state and local tax dollars. Many first-time buyers are in a strong position to buy but lack the necessary 3.5 percent downpayment (required for FHA financing). In talking to my agents, I would estimate that at least 30 percent of all first-time buyers are in...