Federally funded assistance comes in form of mortgages

What about federally-funded assistance?

Some of the most popular federally funded assistance is in the form of mortgages. Here is a few that you may be able to qualify for:

FHA or Federal Housing Administration Mortgages. These are government-insured loans that require a lower down payment, as little as 3%. The seller may be required to financially assist the buyer. In addition, the property must be inspected and pass FHA guidelines. This is a great program for first-time homebuyers.
VA or Department of Veterans Administration Mortgages. Again, these are government-insured loans that are available to members and veterans of the armed services with a small or no down payment required. These loans have extensive qualifications on the borrower and, like the FHA mortgage require that the property also pass an inspection.
The Rural Housing and Community Development Service targets rural areas and the farm community. It provides financial assistance to those who are unable to find financing elsewhere. This program is administered by the United States Department of Agriculture, which has several loans and grant programs focused on rural development.

Do lenders know about the state and federal help?

Most mortgage lenders offer special mortgages that are backed by the agencies of the U.S. government and by the local state agencies. The majority of these lenders can assist you in qualifying for these programs and free money grants.

However, not all lenders are honest and these programs seem to attract scam artists. This especially occurs in areas hit by natural disasters.

How can I protect myself from being scammed when applying for state or federal assistance?

The best way to protect yourself is knowledge. If you get an unsolicited phone call from someone claiming to give you government money, ask them to put the offer in writing so you can have your attorney review it. Generally the federal government does not distribute funds directly to an individual. The individual usually must apply through a licensed lender who will pass the application on to the authorities and organizations and will contact you with information on the funding.

Another sign of a scam is if someone offers you information on government housing grants or promises you funding if you pay a fee. This especially happens in areas that are hit by natural disasters. While a government housing program may have very stringent criteria to qualify, fees are never part of the qualification.

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