Real estate

What you need to know about the NACA mortgage

The Neighborhood Assistance Corporation of America (NACA) claims to offer “America’s Best Mortgage.” Many agents, however, beg to differ as to whether the NACA mortgage is truly as great as it sounds.

No, they don’t take issue with the idea behind the NACA mortgage – the fight for economic justice and making “the dream of homeownership a reality for hundreds of thousands of working people,” regardless of credit and asset issues.

What they find objectionable are all the hurdles agents have to scale and the extremely lengthy escrow period.

“My seller almost took her house off the mkt. It took 5 mos. to close,” says one listing agent in a post on Facebook.

What is an NACA mortgage?

“NACA is the largest HUD certified counseling organization in the country and provides about a third of all counseling, according to the organization’s website. Their aim is to provide mortgages that provide the same terms to all borrowers. These include:

  • No down payment requirement
  • No closing costs
  • No points or fees
  • No credit score consideration
  • Below market fixed rate mortgages

Buyer’s must agree to “join” NACA and are required to pay a $25 fee per family, per year. Since members are “… required to participate in advocacy or other activities,” they must also be registered to vote.

To learn more about NACA, how it started and how it’s “making history,” visit

What agents need to know about a NACA mortgage

Aside from being a “nightmare” transaction, according to several agents, there are things agents should know going into the process with a client.

  • Buyers’ agents should ensure that they have a signed buyer’s representation agreement before the buyers attend the workshop. Otherwise, the buyer will be scooped up by a “NACA In-House Real Estate Agent.”
  • Buyers are required to use a NACA home inspector.
  • Most of the rules, naturally, are slanted in favor of buyers.
  • Listing agents (and their clients) should be aware that there may be numerous requests for extensions and that it may take months to finally close.
  • You’ll need to register any buying client that you want to refer to the NACA program. Learn how here.

NACA urges their members to request the removal of the following from the purchase and sale agreement:

  • Penalties for “… closings past a certain number of days from the executed contract (per diem)”
  • Loss of earnest money if the buyer doesn’t qualify for the loan and if the property doesn’t appraise for the amount the buyer agreed to.

Buyers are also required to ensure that the contract contains:

  • Contingencies that the home becomes NACA-approved by NACA-approved pest and home inspectors.
  • Closing no sooner than 30 days from contract acceptance and 45 to 60 days for homes that require “significant renovations.”
  • An approved NACA and lender settlement agent must provide settlement services

So, your new buyer insists on using the NACA program

We’re increasingly hearing of agents with clients who are insisting on using the NACA program to buy a home. For some, it’s the only logical path to home ownership.

Aside from protecting yourself by getting the aforementioned signed buyer’s representation agreement upfront, NACA has some hoops for you to go through as well.

Oh, and NACA strictly enforces the procuring cause stuff, so it’s important to find out if your buyer has been in contact with NACA before coming to you.

If your client “has been involved with or been in previous contact with NACA at the time the Member [your client] is referred to the Program, you will not be able to register them to your name,” according to the organization’s website.

A lot of what you’ll need to do to retain your buyer is outlined on the website and must be accomplished before your client attends the workshop. You’ll find that information here.

NACA has its own agents too – wanna be one?

“NACA pushed hard for us to work with an in-house NACA Realtor,” according to an unnamed buyer at By the way, this article gives an amazing overview of the NACA program, from start to finish, from the buyer’s point of view.

NACA is currently recruiting in-house agents to work with buyer participants. The stated compensation range in their job ad reads:

“$60,000 to $100,000+ (100% Commission with ability to exceed $100,000)”

Although the ad claims that the agent maintains independent contractor status, it also states that “The NACA Agent position is a full-time job working approximately 50 hours a week and as necessary to meet the demands of the job.” That and the bi-weekly paycheck sound suspiciously employee-ish.

Speaking of pay, agents earn a “fixed amount per closed loan … and is not based on the house price or the amount received by NACA.”

You can learn more about the process of becoming a NACA in-house agent at


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