New Hampshire Housing Finance Authority Assumption of MRB Financed Mortgages Rules (HFA: 302)

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Edmund Green
5 years ago
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1 New Hampshire Housing Finance Authority Assumption of MRB Financed Mortgages Rules (HFA: 302) HFA: General The Authority will normally not approve requests for assumption of existing mortgage loans. However, it is recognized that in certain instances it is in the best interest of the Authority and the mortgagor(s) to allow assumptions to take place. HFA: Purpose The purpose of these rules is to outline conditions under which mortgages financed by Mortgage Revenue Bonds (MRB) may be assumed; procedures to be followed to effect an assumption; and qualifications of the assumptor(s). HFA: Definitions For purposes of these rules the following definitions are applicable: MRB Financed Mortgage - a mortgage financed by tax exempt bonds issued by the Authority. Mortgagor(s) - The person or persons whose name(s) appear on the note which secures the mortgage. Assumptor(s) - The person or persons who are assuming the mortgage. HFA: Assumption Criteria The Authority will consider approving assumptions under the following conditions: (d) Loss of or lengthy disruption of income resulting in an inability to meet mortgage payments. Inability of the mortgagor to continue to occupy the property due to employment transfer or other valid reason, Inability of the mortgagor, after a good faith effort, to successfully sell the property. In all instances assumptions will be considered for the purpose of alleviating 1

2 HFA: Procedure demonstrated economic hardship and not for the convenience of the mortgagor(s). However, in all cases the determination as to whether an assumption shall be approved shall be at the sole discretion of the Authority. The Authority may elect to approve an assumption based upon conditions other those outlined in this section if it determines that such approval is in the best interest of the Authority. Mortgagors who are contemplating disposing of their property by assumption must seek approval, in writing, from the Authority prior to initiating such action. Such prior approval will preclude unnecessary expense incurred as a result of processing a request for an assumption that may ultimately be disallowed. Mortgagors must contact their original lender or New Hampshire Housing Finance Authority to initiate this action. HFA: Qualifications for Assumption of Loans In all cases the prospective assumptor(s) must meet the same criteria as would be required of a participant in the MRB program ongoing at the time of the assumption. These include: (d) (e) income limits appropriate housing/debt ratios first time home buyer where applicable satisfactory credit rating satisfactory record of employment Assumptors must agree to all requirements pertaining to the mortgage they are assuming, as well as, all additional Authority requirements in effect as of the date of the assumption. If there is no ongoing MRB program at the time of assumption, qualification will be determined at the sole discretion of the Authority. HFA: Mortgage Insurance The following criteria apply to loans covered by a primary mortgage insurance policy or loan guarantee. Private Mortgage Insurance - Assumptor(s) must have approval from the Private Mortgage Insurer (PMI) currently insuring the loan. Veterans Administration (VA) - Assumptor(s) must have approval from the VA. Federal Housing Administration (FHA) - Assumptor(s) must have approval from the FHA. 2

3 (d) (e) Rural Development (RD) - Assumptor(s) must have approval from the RD. Assumption will require written approval to the current borrower (s) from the Authority prior to closing. All loans assumed will be processed and approved by the Authority. All assumed mortgages must have mortgage insurance or loan guarantees as applicable. HFA: Fees A processing fee of $250 (payable to NHHFA) will be charged for all assumptions, except those associated with the death of a borrower where the purpose of the assumption is to transfer ownership to a surviving spouse who was not a co-borrower. No fee will be charged for processing such assumptions associated with the death of a borrower. 3

4 ASSUMPTION AGREEMENT THIS AGREEMENT is made this day of, by and among NEW HAMPSHIRE HOUSING FINANCE AUTHORITY, with a place of business at 32 Constitution Drive, Bedford, New Hampshire (hereinafter AUTHORITY) and (hereinafter collectively referred to as BUYERS) This agreement covers the property located at (hereinafter referred to as the PREMISES) WITNESSETH WHEREAS PREMISES are subject to a certain mortgage to, dated and recorded in the County Registry of Deeds at Book, Page, which mortgage secures a Note in the face amount of DOLLARS ($ ) dated and assigned to New Hampshire Housing Finance Authority which assignment is dated and is recorded in the County Registry of Deeds in Volume, Page, and WHEREAS BUYERS wish to assume said mortgage, which assumption requires the written consent of AUTHORITY: and WHEREAS AUTHORITY is willing to allow BUYERS to assume said mortgage upon certain terms and conditions which are set forth below: 4

5 NOW THEREFORE, in consideration of these promises and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto agree and stipulate as follows: 1) AUTHORITY hereby gives its written consent to the transfer of the PREMISES to the BUYERS. 2) BUYERS each shall sign or endorse the original Note in a joint and several capacity, and shall be fully liable on the Note, and on the mortgage, in a joint and several capacity. 3) All other terms and conditions of the said Note and mortgage shall remain in full force and effect. IN WITNESS WHEREOF the parties hereto have caused this instrument to be executed and set their hands the date first hereinafter written. WITNESS NEW HAMPSHIRE HOUSING FINANCE AUTHORITY By BUYER BUYER 5

MORTGAGE OF THE SECOND PART. hereinafter called the "SPOUSE OF THE MORTGAGOR", OF THE THIRD PART OF THE FOURTH PART

MORTGAGE OF THE SECOND PART. hereinafter called the SPOUSE OF THE MORTGAGOR, OF THE THIRD PART OF THE FOURTH PART Page 1 of 5 MORTGAGE THIS MORTGAGE made this day of, 20. BETWEEN: hereinafter called the "MORTGAGOR", OF THE FIRST PART, CIBC Mortgages Inc. trading as FirstLine Mortgages hereinafter called the "MORTGAGEE",