PAWT PAWTUCKET UCKET HOUSING HOUSING AUTHO AUTHORITY RITY HCV HOMEOWNERSHIP PROGRAM
GENERAL OVERVIEW PHA is not required to administer a Homeownership Program; It is voluntary; The PHA has made a commitment to educating, enhancing and empowering the lives of the people we serve. The PHA believes that the Section 8 Homeownership is one of the programs that will allow us to achieve this commitment.
PHA PRELIMINARY REQUIREMENTS
Be a participant of the Section 8 Housing Choice Voucher Program for at least ONE year Must be a participant in “good standing”: Do not currently owe money to the PHA under a repayment agreement and Have had good rental payment history while on the Section 8 Housing Program.
EM EMPLOYM PLOYMENT ENT RE REQUIRE QUIREME MENT NT At least one adult family member must be employed full-time (30 hours per week) Employed for one year Requirement does not apply to an elderly/disabled family
INCOM INCOME E E ELIGIBLE LIGIBLE Minimum gross annual income of $10,300. Public assistance (welfare) cannot be counted in determining income eligibility requirements. Elderly/disabled families are exempt from this requirement.
FIRS FIRST-TI TIME ME HOME HOMEBUYE BUYER To qualify as a “first - time homebuyer” the family may NOT include: • Any person who has owned interest in part or whole of a residence 3 years prior to commencement of homeownership assistance, or • Any person who currently owns title or cooperative membership shares.
First-time homebuyer: also includes a single parent or displaced homemaker who, while married, owned a home with his or her spouse, or resided in a home owned by his or her spouse.
MINIMUM DOWN-PAYMENT A 3% down payment is required. Of the 3% - at least 1 % must be from the family’s personal resources .
ADDITIONAL ELIGIBILITY REQUIREMENTS
HOMEOWNERSHIP COUNSELING CLASSES Must attend and satisfactorily complete a pre-assistance homeownership and housing counseling program and The Homeownership Classes must be approved by the PHA and in conformance under HUD’s Housing Counseling program.
FOCUS OF COUNSELING CLASSES Budgeting and money management; Credit counseling; Obtaining mortgage financing;
Negotiating the purchase price of home; Home maintenance; and Other pre-purchasing educational information
ELIGIBLE UNITS FOR PURCHASE The property purchased must be a one-unit property or a single family dwelling unit or a condominium
INELIGIBLE UNITS Cannot buy a multi-family home \
HQS INSPECTION REQUIRED Unit must pass a Housing Quality Standard inspection A professional inspection will also be done at the request of your financial institution The PHA may refuse homeownership assistance based on the results of each inspection
FINANCING YOUR MORTGAGE
OBTAINING MORTGAGE FINANCING You choose which Financial Lender you want to use; The PHA must approve the financing before it is finalized; It is your responsibility to obtain all financing for the purchase of a home; The PHA will refer you to appropriate agencies for additional financing assistance;
Financing - must be provided, insured or guaranteed by the state or federal government; Financing - must comply with secondary market underwriting requirements; or must comply with generally accepted private sector underwriting standards;
The PHA is not responsible for any financing or become a co- signer for any financing to obtain a home;
The PHA will give you a letter of commitment and certification of your eligibility for home- ownership assistance The letter will indicate the monthly payment you are eligible to receive
The family is responsible for payment of all services required for securing financing and actual purchase.
MAXIMUM TERM FOR HOMEOWNERSHIP ASSISTANCE Homeownership Assistance will continue as long as the family and property continue to meet program requirements, but cannot exceed the following:
If the mortgage is 20 years or longer, initial mortgage assistance will continue for 15 years from the date of commencement of homeownership All other cases are a maximum of 10 years
EXCEPTION ON MORTGAGE TERM – ELDERLY/DISABLED The maximum mortgage term of 10 or 15 years does not apply to elderly/ disabled families The family must qualify as an elderly family at the start of homeownership assistance in order to receive this exception
If a disabled family qualifies as a disabled family at any time during receipt of homeowner- ship assistance for the family the exception will apply
CONTRACT FOR SALE REQUIREMENTS Meet your Lender’s requirements; Specify price and other terms of sale; Specify that the purchaser will arrange for pre-purchase inspection by an independent inspector;
CONTRACT FOR SALE REQUIREMENTS (CONT’D) Specify purchaser will not be obligated to purchase the unit unless inspection is satisfactory to purchaser and PHA; Specify purchaser is not obligated to pay for any necessary repairs; and Must contain a certification that the seller has not be debarred, suspended or denied participation.
MONTHLY HOMEOWNERSHIP PAYMENT: Homeownership Payment is the lower of: The Payment Standard minus the 1. Total Tenant Payment or The family’s monthly homeownership 2. expenses minus the total tenant payment.
Payment may be sent to the family or lender; If the payment exceeds the amount due to the lender, the Housing Authority must pay the excess directly to the family.
PORTABILITY A family may move to another city/town with homeownership assistance; Family must meet that Housing Authority’s requirements under their Homeownership Program.
MOVING WITH CONTINUED ASSSITANCE The family may move to a new unit with either: 1. Tenant-based housing or 2. Homeownership assistance
DENIAL OR TERMINATION OF ASSISTANCE PHA may deny or terminate homeownership assistance, as well as tenant-based assistance, if the family fails to meet it’s obligations under the homeownership program.
DEFAULT ON PREVIOUS MORTGAGE The PHA cannot begin home- ownership assistance for a family who has previously received assistance under the home- ownership option and who has defaulted on the mortgage.
RECAPTURE OF HOMEOWNERSHIP ASSISTANCE If the family sells or refinances the home, the PHA shall recapture a percentage of the homeownership assistance.
The amount of recapture will automatically be reduced over a 10-year period, beginning one year from the purchase date, in annual increments of 10 percent.
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