Has anyone ever dealt with Nehemiah program? - Posted by Sherry W

Posted by Ron (MD) on March 09, 2001 at 11:47:40:


The whole point of this program is to enable a seller to give a buyer more money toward closing. It is a legal loophole related to FHA loans.

I don’t think Nehemiah is used if the buyer is not getting FHA financing.

FHA limits a seller’s contribution toward buyer’s closing costs to 6% of the price. Also, I think FHA requires the buyer to have 3% (I think) of their own money in the deal (which can be obtained from family as a gift or borrowed from “approved” programs).

Nehemiah is a convoluted way for you to give the buyer up to 9% (the 6% closing cost help allowed by FHA plus an additional 3%). The way it works is, you give Nehemiah 4% and they “gift” 3% to your seller. Nehemiah keeps the 1% difference. So, it costs you 10% to give your buyer 9%.

If you are giving your buyer 6% (or less), I don’t think you need to go through Nehemiah (and give them the one point).

This is a program that I’ve never used because I usually give about 3% in closing cost help and never give more than 6%.

Ron Guy

Has anyone ever dealt with Nehemiah program? - Posted by Sherry W

Posted by Sherry W on March 09, 2001 at 11:34:51:

Wondering if anyone has ever sold a house to a buyer with them going thru the Nehemiah program?

Have contract on house with buyer. I am having to give 4% to this program. It helps with the buyers down payment or closing costs or both.

I have been holding this house since Oct. and it’s eating up my profits with the holding costs.

Just wondering more about this program, my realtor doesn’t know hardly anything about the program.

Just wondering what I am looking forward to with closing this deal.

Sherry W.

Another similar program : AmeriDream Charity - Posted by Billm

Posted by Billm on March 09, 2001 at 21:17:35:

seller charged 3.75%- Charity pays 3% sales price to buyer’s costs/down payment. Applies to FHA and any other purchase/sale, for that matter, so long as lender allows a charitable gift used as buyer’s closing/down payment in lieu of his/her own funds.

It’s a way to reduce out of pocket for buyer, while not mucking up other seller funded concessions. Buyer’s can come out of closing with money in their pocket, if they have a savvy agent.


Yes, what a scam - Posted by JD

Posted by JD on March 09, 2001 at 18:33:38:

I just learned about the program a month ago when I sold a house to a buyer using the program. No reason you shouldnt sell to such a buyer as long as the numbers are right. Basicly this CA non profit named Nehemiah does nothing more than work as an intermediary so a Buyer can get a HUD loan with no money down (as opposed to the standard 3%). Nehemiah gets 1% of purchase price for shuffling some papers. Nehemiah must have greased some palms at HUD to get that program approved.

Doing one right now! - Posted by Vic

Posted by Vic on March 09, 2001 at 12:53:44:

Ron’s post below pretty much describes the Nehemiah program.

Here’s the link, you can check it out for yourself


Know this, the buyer has to be able to verify that they have at least 1% of the purchase price for a down pmt. They don’t have to use it, but they do have to show that they have it in a verifiable account.

Also, if you handled this right, you added the 4% that Nehemiah wants plus the closing costs to the purchase price. The house has to appraise for the total of everything - pur price plus closing plus the 4% gift from Nehemiah.

Hope this helps,