The lawsuit seeks to overturn that. HUD officials argue that Nehemiah’s borrowers have a higher default rate. But Nehemiah President Scott Syphax says the ban has no merits.  

"We believe that HUD’s action is damaging to lower income home buyers across the United States and frankly is going in the exactly wrong direction when it is that families across the United States have fewer and fewer options for being able to purchase a home."

Syphax says Nehemiah has helped more than 600,000 families across the US make down payments.