How do I explain the Newsong Down Payment Assistance Program to a buyer?
First, let the buyer know that the seller needs to participate in the program in order for it to work. The seller does this by paying a fee equal to the down payment plus $250. Explain that this is not a contribution to the buyer. The fee charged to the seller simply replenishes the program fund, so that those funds can be used for other homebuyers in the future. Since the seller needs to contribute to the program fund, the buyer must understand that the seller will not negotiate as much with them as they would with a cash buyer. Chances are, the seller will want the full list price or something close to that. However, the buyer doesn t need to be concerned that he isn’t getting the lowest price possible. First, he is getting a property that is selling for what it is worth. Second, he will achieve a tax benefit, appreciation on the property and the ability to buy the home at a lower price now, than at sometime in the future.
