Nehemiah DPA, in the Critic’s Eye
In the current shakedown with FHA down payment gifts a number of the intermediary non-profits are looking to lose their tax exempt status. So far only two organizations have officially had their status revoked, but with potentially many more on the horizon, I decided to take a look at one of the biggest: The Nehemiah Program.
According to its website, The Nehemiah Program is “The Most Trusted Name in Downpayment Assistance.†Well, according to spell check and Merriam-Webster, down payment is two words, so I’m already a little leery. The next interesting tidbit comes from the Sellers section. It begins innocently enough:
The Nehemiah Program provides gift funds for downpayment and closing costs to qualified homebuyers who use an eligible loan product such as an FHA insured mortgage or conventional loan.
A gift, one might think. How nice. Let’s look at the end of the paragraph:
For the buyer to be eligible for the gift, the seller must make a contribution to Nehemiah Corporation of America that is equal to the gift amount, plus pay a small processing fee.
What? A few sentences ago The Nehemiah Program was providing a gift that never had to be repaid. Right below that I’m reading that it’s actually a gift provided by the seller plus a processing fee. Now, that’s a horse of a different color.
