Question: Does [Name of Program] accept your certificate?

This question comes up fairly often from someone who is doing a  particular mortgage program, a down payment assistance program, or some other affordable housing opportunity. For two of the programs I can give an unequivocal “yes”. Our certificate is given through our approval with Citizens’ Housing and Planning Association(CHAPA), a non-profit umbrella organization for affordable housing and community development activities in Massachusetts. The certificate we award to participants who complete the workshop is definitely accepted for mortgages with Mass Housing and with Massachusetts Housing Partnership. 

For anything else, like a down payment  assistance program, I am reasonably sure that our certificate is precisely what the buyer is supposed to get. Here is the thing, though. I cannot answer for someone else. I always suggest to the buyer that they check with [Name of Program] to see if they do in fact accept our certificate. 

Just as you might not want to check with your credit card company to see if a certain store would take a particular card, it is best to check with the entity making the decision. In that case, you would check with the store itself. At best I can only tell someone I expect that program to accept our certificate, but to find out for sure, it is best to check directly with the program.

Question: How much money in closing costs will we need after the closing?

Answer: My first answer to this question was that you don't need to pay closing costs after the closing. You pay them before or at the closing.

While that answer is correct, there is another way to look at it. The woman asking the question may not have had the best vocabulary to get the right answer and that is often the case. She wanted to know how much money she and her husband would need to have in the bank after the closing. She wanted to now how much they would need in reserves. Reserves are not actually closing costs, but they may be a requirement of the loan program you are using. Particularly if you are buying a multi-unit property, your lender does not want to know that you completely bottomed out all of your available funds to make the closing happen. They really want to know that you have enough money to make the mortgage payment, especially that first payment. They want to know you have some money for emergency repairs.

To find out if you will be required to have reserves and how much, ask your loan originator as you are considering different loan programs. Most of them will tell you and disclose that amount to you, but occasionally someone in the workshop tells me they found out they need reserves but did not know initially. Ask. Ask if you will need reserves and how much will you need.

Questions Answered

Starting a new feature today. Approximately once a week, I'll answer a question that has come up in one of the workshops (or in the process of registering for a workshop). I realize I frequently answer the same questions and even some seemingly unique questions. First up will be a question about closing costs.

June workshop - June 27& 28

Our June workshop has been changed to the weekend of June 27 & 28. There is still room in the class. Please email Ellie O'Leary to get the information sheet and the registration form.

June weeknight workshop

We are receiving registrations now for the rare weeknight workshop, this one meeting at the Newburyport Bank on June 16 & 17 and finishing on June 23 & 24. For more information and the registration form please email Ellie O'Leary.

Mad Hatter Fundraiser in Newburyport

Ovarian Cancer Awareness at the Mad Hatter Fundraiser

Mad Hatter Tea Party

Glenn's Restaurant & Cool Bar

44 Merrimac Street, Newburyport

Sunday, June 14, 2015

1:00 - 3:00 PM

For more info check here. 

Next Workshop

We still have room in our next workshop which will meet in Newburyport on May 16 & 17 from noon to 5 p.m. Fee is $70 per household. Email Ellie O'Leary at EOLeary@coastalhb.org to receive the information sheet and the registration form, with instructions for online payment.