PreferredProgram: Frequently Asked Questions

return to top What is the PreferredProgram®?
The PreferredProgram is a Downpayment Assistance Program provided by The Genesis Foundation. The Genesis Foundation is a nonprofit 501(c)3 charitable organization. Through it, the PreferredProgram provides gift funds, with no repayment required, to qualified applicants purchasing homes.
return to top What is a "Participating Home?"
A participating home includes new or resale residential properties where the seller of the property agrees to contribute back to The Genesis Foundation the amount gifted to the buyer, plus a processing fee.
return to top Why would a seller use this program?
The Genesis Foundation is designed to give the seller's house a competitive advantage due to the fact that, with no downpayment required, the seller can attract a larger pool of qualified buyers - those with good credit, who have enough money to handle the monthly mortgage payment, but simply do not have the assets for a downpayment. Typically, it can take weeks or months to sell a home, often resulting in sellers reducing their asking price considerably just to get their house to "move." With the PreferredProgram, more buyers are competing for the same home. So, the seller typically gets the highest price for his or her home in the shortest amount of time.
return to top Does the seller's contribution, in fact, pay for the buyer's downpayment?
Not at all. The funds necessary from the downpayment come directly from the pool of the PreferredProgram gift funds. The contribution made by the seller replenishes the pool of funds, enabling future buyers the same opportunity to purchase a house with "no money down."
return to top Since the seller is making a contribution to the PreferredProgram, a charitable, not-for-profit organization, is this contribution tax deductible?
The Seller's contribution paid to The Genesis Foundation is not tax deductible as a charitable contribution because the Seller derives the full benefit of the contribution through the sale of a home. For questions or clarification, please contact your personal tax advisor.
return to top Since sellers often get their asking price - or very close to it - is the cost of the participating home overpriced to compensate for the sellers contribution?
Definitely not. Participating homes are priced according to Fair Market Value, which must be supported by an independent URAR appraisal. This turns out to be of significant advantage to the seller because, with this appraisal, the seller has an excellent idea of how his/her home compares to similar properties and supports the asking price.
return to top Can any mortgage originator utilize the PreferredProgram?
Yes, as long as it meets the criteria of the underwriter, and the seller agrees to participate in the program.
return to top Do PreferredProgram loans take longer to close?
No, funds can be wired same day if necessary.
return to top Does the buyer have to repay the gift?
No, the gift funds available to qualified buyers through the PreferredProgram require no repayment. Once the home buyer and home seller participate in the PreferredProgram, the funds given to the home buyer are a true gift. The PreferredProgram charges a processing fee, which may be paid by the seller, lender, or home buyer.
return to top Is the PreferredProgram FHA approved?
FHA does not approve ANY downpayment assistance program. We are, however, a 501(C) 3 charitable foundation and therefore meet FHA's requirements for gifting a downpayment to a buyer.
return to top Are there any income limitations for potential buyers?
There are no income limits. If a buyer is approved for a loan, he or she can participate in the PreferredProgram and receive gift funds to use for a downpayment and/or closing costs.
return to top Is the PreferredProgram nationwide?
Yes, we provide downpayment assistance nationwide.
return to top Does the PreferredProgram provide marketing materials?
Yes, we have marketing materials, i.e., brochures, direct-mail postcards, etc., available in both English and Spanish. Marketing materials are geared toward buyers, lenders, sellers, and other organizations, including realtors, that may benefit from using the PreferredProgram.
return to top How do we know if our wholesale lender is approved?
Contact the PreferredProgram, and we will FAX or e-mail you a copy of our approved lender list.
return to top How do I get started today?
You can get started by visiting our web site at www.preferredprogram.org, or by calling Client Services at 1-866-570-0830. A representative will be delighted to help you!
return to top How do I know when buyer's gift funds are wired to the closing office?
Confirmation of wire is sent via email to loan originator, and via fax to closing office, verifying time, date, amount and tracking number for gift funds. All gifts are wired within 24 hours prior to close.
return to top What verbiage needs to be added to the Real Estate Purchase Agreement in order to include Downpayment Assistance from the PreferredProgram?
"This offer is contingent upon the buyer receiving a gift from The Genesis Foundation in the amount of $x.xx and the seller agrees to the attached addendum." Addendum to be attached. NOTE: Lender requests gift funds for the buyer using our Online Processing System.