On March 3, 2000 FHA issued Mortgagee Letter 00-8, titled "Nonprofit Agency Participation in Single Family FHA Activities". This mortgagee letter clarifies to the lending community, FHA's position on the issue of downpayment assistance and Nonprofit organizations associated with FHA programs, including the 203(k) program, and secondary financing programs.

The letter also clarifies once and for all that FHA does not "approve" downpayment assistance programs in the form of gifts administered by charitable organizations. Instead, lenders are expected to review the requirements of HUD Handbook 4155.1 (which is the HUD underwriting manual for FHA loans) to ensure that gift sources meet the instructions set forth in the handbook. The Home Downpayment Gift Foundation also known as HDGF is in compliance with FHA guidelines, (including HUD handbook 4155.1).

The letter provides that "If the nonprofit agency is providing downpayment assistance in the form of a gift, lenders are to enter into the CHUMS system the Federal Tax Identification Number of the nonprofit agency in the field designated for a charitable organization's tax identification number.

For your records and information, HDGF's Federal Tax ID# is 54-2017625.

To view this letter in more detail, simply click here .

Back to Top