Lender and Realtor Training. Neighborhood Stabilization Program Homebuyer Assistance Program Pasco County Community Development Department

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1 Lender and Realtor Training Neighborhood Stabilization Program Homebuyer Assistance Program Pasco County Community Development Department

2 Common Rules For All Programs Pasco County Loan interest rate is 0% Second mortgage 0% interest as long as owneroccupied If not, loan is due ( at about 6% interest). Minimum investment by client required

3 Other Program Rules First Loan may not be more than 1% over average rate. ( Maximum Lender Fees and Points cannot exceed 4% (Unless it is a very low first mortgage). No Special Realtor fees Borrowers do not have to be first time homebuyers, but the purchased property must be homesteaded

4 Pasco Opportunity Program

5 Pasco Opportunity Program (POP) POP Agencies Keystone Challenge Fund Tampa Bay CDC East and Central Pasco Habitat West Pasco Habitat POP agencies buy eligible homes, repair them, and make them available for sale to low and moderate/middle income families

6 POP Assistance Moderate Income Moderate Income Households can receive up to $10, in down payment assistance Maximum Yearly Income 1 Person $50,280 2 Persons $57,480 3 Persons $64,680 4 Persons $71,760 5 Persons $77,520 6 Persons $83,280 Moderate Income Buyers Must Contribute at Least $ toward the purchase of the property

7 POP Assistance Low Income Low Income Households (Under 80% of the Median Income) can receive up to $20, Maximum income levels: 1 Person $33,500 2 People $38,300 3 People $43,100 4 People $47,850 5 People $51,700 6 People $55,550 Low Income Buyers Must Contribute at Least $ toward the purchase of the property

8 POP Assistance Very Low Income Very Low Income Households (under 50% of the median income) can receive up to $30, Maximum Yearly Income 1 Person $20,950 2 Persons $23,950 3 Persons $26,950 4 Persons $29,900 5 Persons $32,300 6 Persons $34,700 Very Low Income Households cannot purchase a house with a sales price of more than $100,000. Buyers must contribute at least $ toward the purchase.

9 POP Assistance Amounts New Construction Buyers purchasing homes that are constructed by POP Agencies are eligible for increased down payment assistance: Low/Moderate Income- $25, Very Low Income Up to half of purchase price (home must be less than $100,000)

10 Purchasing POP Homes The Process When construction is completed, price is set and property advertised on website and MLS For 7 days offers are accepted (for the asking price only) but not committed. After the 7 th day if there are more than one offer a lottery is held in our office. After that, first come first served. All offers must be for the asking price. There is no negotiation on the price

11 Homebuyer Assistance Program

12 This is Down payment Assistance Family Size 1 Person 2 Persons 3 Persons 4 Persons 5 Persons Very Low $20,950 $23,950 $26,950 $29,900 $32,300 Low $33,500 $38,300 $43,100 $47,850 $51,700 Mod $50,280 $57,480 $64,600 $71,760 $77,520

13 HAP Rules Any property is eligible, except mobile homes Maximum sales price $240,000 Available in entire County, including all cities Minimum required contribution: Very Low Income $500 Low Income $1,250 Mod Income $1,500

14 HAP Benefits (for contracts signed after June 1, 2017) Without FHFC Bond Assistance Income Level Maximum Amount of Assistance Very Low Income $15, Low Income $10, Moderate Income $5,000.00

15 HAP Benefits (for contracts signed after June 1, 2017) With FHFC Bond Assistance Income Level Maximum Amount of Assistance Very Low Income $10, Low Income $5, Moderate Income $5,000.00

16 Upcoming Changes to HAP Program Pending BCC Approval June 6: No purchases in flood zone or repetitive loss areas No sinkhole homes, including those that have been remediated

17 Pasco County Homebuyer Programs Process and Timeline 1. County-sponsored homebuyer education class is required. 2. Homebuyer signs contract for home and is pre-approved by lender. 3. If HAP, Lender must send reservation. 4. Lender sends loan package to County. 5. County approves application package.

18 6. Homebuyer meets with homebuyer counselor. 7. Mortgage package ed to title company. 8. Homebuyer assistance check is released by county after HUD 1 is approved. Note: Check takes 6 business days to be issued 9. Closing occurs.

19 Application Package County Checklist Form Bank Application (1003) Good Faith Estimate (NUMBERS ON FIRST THREE DOCUMENTS MUST MATCH) Verification of Income and Assets of everyone living in property (3 rd party verification) Verification of Employment 6 months of checking account statements, current savings account statement Homebuyer Class Certificate (Within 2 years) Credit Report Real Estate Contract Most recent tax return. Complete Title Commitment Appraisal DOCUMENTS EXCEPT FOR CONTRACT, CLASS CERTIFICATE AND TAX RETURN MUST BE NO MORE THAN 90 DAYS OLD

20 What is Income? Wages, Salaries, Overtime, Fees, Commissions, Bonuses Net income from the operation of a business or profession Interest, dividends, and other net income of any kind from real or personal property All gross periodic payments received from Social Security, SSI, welfare, annuities, insurance policies, retirement funds, pensions, disability or death benefits, and other similar types of periodic receipts. Payments in lieu of earnings, such as unemployment, worker's compensation and severance pay Periodic and determinable allowances, such as alimony and child support payments, and regular contributions or gifts received from persons not residing in the dwelling All regular pay, special pay, and allowances of a member of the Armed Forces (whether or not living in the dwelling) who is head of the family, spouse, or other person whose dependents are residing in the unit

21 What is Not Income? Income from employment of children (including foster children) under the age of 18 years Payments received for the care of foster children Lump-sum additions to family assets, such as inheritances, insurance payments (including payments under health and accident insurance and worker's compensation), capital gains and settlement for personal or property losses Educational Scholarships/Grants Only first $ of income counted for children over 18 in school full time proof of enrollment must be provided

22 What Is An Asset? Savings accounts and checking accounts Stocks, bonds, savings certificates, money market funds, and other investment accounts. Equity in real property or other capital investments The value of land, in excess of land allowable for housing production Cash value of trusts that are available to the household IRA, Keogh, and similar retirement savings accounts Contributions to company retirement/pension funds that can be withdrawn without retiring or terminating employment Assets that, although owned by more than one person, allow unrestricted access by the applicant Lump-sum receipts, such as inheritances, capital gains, lottery winnings, insurance settlements, and other claims Personal property held as an investment such as gems, jewelry, coin collections, antique cars, etc. Assets disposed of for less than fair market value during two years preceding

23 If total assets more than $250,000, not eligible for County programs.

24 What Is Not An Asset? Necessary personal property Interest in Indian trust lands. Assets that are a part of an active business or farming operation. (Note: Rental properties are considered personal assets unless real estate is the applicant's main occupation.) Assets not accessible to the family and that provide no income for the family Vehicles specially equipped for the handicapped Equity in owner-occupied cooperative and manufactured homes in which the family lives Assets held in applicants' name but which are actually owned by someone else. Cash value of life insurance policies

25 Ratio Requirements May not be greater than 35%/40% for easy approval. If they are above those numbers but less than 40/45, a committee will decide if there are enough positive indications (great credit or large bank acct. etc.) to approve. Over 40/45, automatic decline.

26 Pasco County Loans Payments will be required if front-end ratio is 28% or less and the back end ratio is less than 38% If ratios are higher, loan will be deferred for 5 years, with terms of years, depending on level of assistance. If appropriate there will be two notes, one payback and one deferred.

27 Shared Equity Provisions Portion of the appreciated sales price will be shared with the County, in addition to the principal balance For the first three years that percentage is 50% For years 4 and 5 it is 25%. Appreciation is defined as the gain a homebuyer receives from the sale of the home, less any reasonable title and real estate costs. The cost of home improvements completed with building permits also shall be deducted from this amount. Under no conditions shall this penalty be more than twice the amount of the original County loan.

28 Shared Equity Example #1 Mr. Jones bought a house for $100, with $10, in down payment assistance from the County. 2 years later, he sells the property for $200, Pasco County is owed half of the equity he has earned, up to twice the original amount of the county loan. $200,000 - $100, = $100, $100,000.00/2 = $50, Since half the equity he has earned is more than twice the amount of the original county loan, the only shared equity he owes is $20,

29 Shared Equity Example #2 Mr. Jones bought a house for $100, with $10, in down payment assistance from the County. 4 years later, he sells the property for $200, Pasco County is owed one-quarter of the equity he has earned, up to twice the original amount of the county loan. $200,000 - $100, = $100, $100,000.00/4 = $25, Since one-quarter of the equity he has earned is more than twice the amount of the original county loan, the only shared equity he owes is $20,

30 Shared Equity Example #3 Mr. Jones bought a house for $100, with $10, in down payment assistance from the County. 5 years and one day later, he sells the property for $200, No Shared Equity is Owed, as it is beyond the 5-year threshold

31 Designed to provide qualified first-time homebuyers with up to $15,000 in down payment and closing costs assistance. Forgiven 20% each year as long as the borrower is still the owner-occupant and has not defaulted on the loan. Maximum Income Level - $82,800 Sales Price - $312,368 May be combined with Pasco Home down payment assistance

32 Other Programs Pasco County works with Mortgage Credit Certificate Federal Home Loan Bank funds Approved lenders: please contact Community Development to discuss particulars of these programs.

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