Entries Tagged as 'Money'

Cautions about ACORN Housing

I know I’ve made ACORN Housing sound pretty incredible so far. While I do believe that they are, there are some downsides to get through. Homebuying is a pretty stressful process. It is especially so for first-timers. I was always afraid that everyone around me was ripping me off. I never felt like I knew enough to actually be comfortably in charge of my own situation.

ACORN was a great help in terms of information and providing one central location for the money transactions, but I found out quickly that they are not a hand-holding organization. You’ll have your counselor’s phone and email address, but the reality is, they just won’t be able to touch base every day. They won’t be there to answer the two dozen questions that pop in your head over breakfast.

The more you, the participant, are willing to do the work and stay on track, the better the program performs. You need to be dedicated to the process because they don’t offer classes and appointments at your leisure. The first Intake session is usually scheduled for a weeknight. The rest of the time, you may need to take time off work to get it done. The boyfriend and I finished in about two months.

It is also tempting to think that your ACORN experience is all you’ll need. While they do try to educate about insurance, property taxes, etc., those things are outside of what they can do for you. Any future home owner should research these costs and figure out his/her own bottom line.

The final item that I feel I should list is a funny one. Still, it is very important. ACORN’s process approves you for too much money. I don’t remember the actual numbers, but I think I could have been approved for up to 60% of my income. They would have let me allocate 60% of my monthly paycheck to my mortgage. Any traditional loan program is going to faint at that possibility. Personally, I think that’s a very dangerous ratio as well. If 60% of a person’s income is going towards his/her home, there’s just not enough of a safe zone for when something goes wrong. It’s important to be smart and keep your head. Buy only what you can afford.

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Tags: Money, Recommendations by Ms.
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ACORN Housing Program Details

The main thing you need to go through ACORN’s homebuyer program is time. You have to commit to an “Intake” orientation/introduction session. Here, they’ll take some forms you’ve already filled out and give you some financial worksheets to bring to your one-on-one session with a counselor. You’ll also pay for your credit check at the Intake so your counselor will have all your numbers ready for the next meeting.

At the counseling session, the adviser will tell you your credit score and what you can obtain from the lenders participating in their program. If it is not what you want, the adviser can also help you formulate a plan and give you a time frame for improvements. That includes setting up a workable budget and creating a savings plan.

Then you have another seminar to attend, and this one is really helpful. They bring in a lawyer, a real estate agent, a mortgage lender, and a home inspector to explain what they do, and what you should look out for. After this, depending on what you actually want to buy (house, condo, etc.), there may be one more educational session to attend.

The actual house hunting part of the deal is all on your own. You’re just doing it knowing an exact amount for which you are pre-approved. Like I said, I love this program and am so glad that the boyfriend found it for us. That’s not to say that everything about the experience was perfect though. There are some negatives to keep in mind. I’ll save those for next time.

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Tags: Money, Recommendations by Ms.
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What ACORN Housing Can Offer First-Time Homebuyers

Previously, I had mentioned that I really like what ACORN did for my boyfriend and I. The financial benefits are amazing. We got our place with no money down, no PMI, and a 30-year-fixed at 6.012%. That’s pretty darn good considering the times and our resources.

ACORN is able to do this because they create relationships with lenders. When we went through the program, the best deals were with Bank of America. The banks are willing to extend more favorable terms because they know that the people who go through the program understand what they are taking on. Also, if the home buyer gets into trouble down the line, the bank will be able to turn the paperwork back over to ACORN so everyone can work on solutions. Contrary to popular belief, banks don’t like to foreclose. They would much rather get their money back–plus interest.

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