Homeownership Pool Program

2008 Rules Change Summary

 

HOP provides down payment assistance for the purchase of new construction units or substantially rehabilitated units under the Homeownership Assistance Program (HAP).  Below is a list of changes to the rules for 2008.  Kudos to our Members and the others who took the time to participate in the rule making process.  We obtained a number of concessions which should make HOP more user-friendly for CDCs.

 

Clarification of Definitions – 67-57.005

      (30) Living space means areas in a dwelling unit that are livable space and does not include closets, crawl spaces and other storage areas.

      (34) Manufactured Home means a single-family house constructed in a controlled factory environment, built to the federal Manufactured Home Construction and Safety Stands administered by HUD.  The unit may be single- or multi- sectional and is transported to the site and intalled on a permanent foundation.

      (40) Personal Assets means cash held in savings/checking accounts, safe deposit boxes, rental property equity and other capital investments; cash value of stocks, bonds, T-bills, money market accounts; cash value of life insurance; personal property held as investment; lump sum payments or one-time receipts such as inheritance or insurance settlements; mortgages or deeds of trust.

      (45) Retirement Assets means individual retirement and Keogh accounts, retirement and pension funds.

 

 

Fees – 67.57.010

      (5) Member shall be charged a failed inspection fee of $500 for all homes inspected by FHFC that have been determined to not have been built in compliance with HOP Property standards, per rule chapter 67-57.040.  Non-compliant home(s) must be brought into compliance ant eh assessed fee must be paid before the HOP loan will close.  This fee CANNOT be passed on to the Eligible Homebuyer.

 

 

Membership Application Procedures – 67.57.030

      (5) & (6) Renewal at each annual renewal, members must notify FHFC of any changes to the development team or organization structure.  Failure to do so will result in the inactivation of the membership of the Member.

 

 

Property Standards – 67.57-040

      (1)(h) cable or satellite TV hookups located within 12” of an electrical outlet

      (n) toggle-type or rocker style switches for lights and fans

      (o) all living spaces must be equipped with overhead lighting

      (p) all doors must be a minimum of 34” (2’x10”) or larger; ALL doors must provide for a    minimum 43” clear width entry

      (r) units of 2 or more levels must meet the requirements of paragraphs (1)(a)-(q) for the   entry level and the second level must contain at least 1 full bathroom and bedroom, meeting         the requirements of paragraphs (1)(a)-(q) if there is not a full bathroom and bedroom on the       entry level.

      (s) clarification of home maintenance manual contents

      (2) Effective 1-1-2009, all new construction units, excluding Self-Help units must be certified      to one of the following green building practices: Energy Star, Florida Green Building        Coalition or Leadership  in Energy and Environmental Design (LEED)

 

 

HOP Program Restrictions- 67.57.050

(1)   SHIP Administrators  (not recipients)may make reservations for substantial rehabbed units

(4) Eligible participants changes include for-profit organizations acting solely as the developer/builder and CHDOs approved by FHFC, and ship administrators

(13)(c) Energy Codes must meet or exceed the 2007 Florida State Energy code

 

 

Eligible Homebuyer Requirements- 67.57.060

      (1)(e) Assets: personal assets in excess of $30,000 (down from $50,000) and retirement assets in excess of $100,000 (separated with a higher level)

      (4) HOP loan subordination; will be considered based on loan type, term of loan FIXED interest rate percentage.  Balance of item is unchanged

 

 

Homebuyer Loan Process – 67.57.070

      (5)(g) Loan Servicing Borrower Analysis Package must include a copy of approval page generated from the HUD Income Calculator

      (7)(e) Loan Closing Package  must include certification from EnergyStar, Florida Green Building Coalition or LEED, effective 1-1-2009

      (9) CHDO Reservations  may be made in the name of the homebuyer PRIOR to the start of construction.  The HOP Self-Help/ CHDO Checklist must be sent to the Corporation within 14 DAYS of the reservation date accompanied by a copy of the construction contract covering the building of the unit.

 

If the construction contract provides for 12 or more units, the CHDO must provide evidence from a third party that the construction of these units are in compliance with federal Davis Bacon and other applicable labor regulations and laws

Underwriting Guidelines

For ALL HOP Loans

·       Eligible homebuyers should have a cash reserve, remaining on deposit after loan closing, equal to one month’s PITI

·       Loans should be provided in the minimum amounts that will make the homes affordable.

·       Over-subsidized loans may be reduced or denied

·       Loans that financially overburden the homebuyer will be denied

 

For all loans NOT using FHFC Bond Program, local FLORIDA HFA Bond program, FHA loans, VA loans, direct loan from Habitat or USDA-RD

·       Loans must be made by financial institutions and have a debt ratio between 29% - 45%

·       First mortgage must carry a fixed interest rate that can be no greater than the current 10 year T-Bill yield + 3.5%

·       Insurance and tax escrows are required

·       Interest-only mortgages are not permitted

·       No prepayment penalties are allowed

·       Mortgages with negative amortization features are not allowed

·       Closing costs should not exceed 5% of the purchase price

·       Seller concession exceeding 3% of the contract purchase price of the home should not be allowed with HOP funds