Homeowner Rehabilitation Assistance (HRA)

Transcription

1 Administered by

2 Overview Homeowner Rehabilitation Assistance (HRA) may be provided in the form of either loans or grants Ensure that all household applicants clearly understand the type of assistance they are eligible to receive When appropriate, provide homeowners an option to choose 2

3 Required Loans Loans are required in the following circumstances: Housing unit is being replaced on another site Homeowner is being relocated out of a flood zone Manufactured Housing Unit (MHU) is being replaced with a site-built structure Required loans are subject to 24 CFR (refer to Affordability Period table) 3

4 Affordability Period Table per Final Rule 24 CFR Total Amount of HOME Assistance Under $15,000 Affordability Period 5 years $15,000 to $40, years Over $40, years 4

5 Deferred, forgivable loans: 0% interest Are forgiven in equal yearly amounts until the loan balance is reduced to zero, provided the assisted household occupies the assisted property throughout the applicable affordability period Annual forgiveness occurs on the anniversary date No monthly payments Deferred, Forgivable Loans 5

6 Repayable loans: Repayable Loans Are required for households with income that is 60%-80% AMFI 15-year repayment term during which the assisted household must continue to occupy the property as principal residence 0% interest Requires monthly payments to the Department 6

7 Grant Agreements Grants include an affordability term requirement (refer to Affordability Term table): Only available for households with income <= 60% AMFI Requires continued occupancy as principal residence 7

8 Affordability Term Table per 10 TAC 53.3(l) Household AMFI Form of Assistance <=30% 0% interest, 5-year deferred, forgivable loan or grant >30% and <=50% 0% interest, 10-year deferred, forgivable loan or grant >50% and <=60% 0% interest, 15-year deferred, forgivable loan or grant >60% and <=80% 0% interest, 15-year REPAYABLE loan 8

9 Recapture for Loans and Grants Termination of Occupancy In the event the assisted property ceases to be the household s principal residence, forgiveness of the loan or grant agreement stops Death of homeowner Sale of property No longer principal residence The remaining unpaid or unforgiven balance may become immediately due and payable to the Department 9

10 Recapture for Loans and Grants Death of Homeowner In the event the homeowner dies: If new owner qualifies for HOME assistance in accordance with 10 TAC Chapter 53, title to the assisted property may be transferred and forgiveness of the loan or grant may continue until maturity New owner may be required to provide support documentation evidencing HOME eligibility If new owner is does not qualify for HOME assistance, the remaining unpaid or unforgiven balance becomes immediately due and payable to the Department 10

11 Recapture for Loans and Grants Sale of Assisted Property In the event the assisted property is sold: Department will recapture the unpaid or unforgiven balance to the extent net proceeds are available from the sale, based upon the requirements of 24 CFR The property cannot be sold for less than the tax appraisal value as of the date of sale unless the entire unpaid or unforgiven balance is paid in full at closing 11

12 Loan processing occurs simultaneously with the commitment of funds to an eligible household The loan documents are currently reviewed by several divisions within the Department: HOME Program Services Legal Executive Loan Processing Loan documents must be signed by the homeowner and all other required parties at a title company, an attorney s office, or the lender s office 12

13 Loan Processing (cont.) Applicant must be given 24 hours to review loan documents before signing Applicant has a 3-day right of rescission period after signing the documents during which he/she may cancel the agreement Contract Administrator (CA) must receive approval from the Department s Legal Division before recording specific loan documents The Department must provide approval for release of funding before the CA may submit an electronic draw request using the TDHCA Housing Contract System 13

14 Grant Processing Grant agreement processing occurs simultaneously with the commitment of funds to an eligible household The grant agreement documents are reviewed by HOME staff HOME Division Director will sign the grant agreement and it will then be submitted to the CA Grant agreement must be signed by all required parties Signing may occur in the CA s office Signatures must be notarized The fully executed grant agreement must be recorded in the County Clerk s office Original, recorded grant agreement must then be submitted to the Department before the CA may submit an electronic draw request using the TDHCA Housing Contract System 14

15 For More Information Contact TDHCA s HOME Division Direct: Toll Free: Visit the HOME Division online at: Administered by 15