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Home Ownership Programs Presented by  Irene Hardisty Single Family Production Director
<ul><li>FirstHome  Program </li></ul><ul><ul><li>first mortgage </li></ul></ul><ul><ul><li>grant (Plus) </li></ul></ul><ul...
<ul><ul><li>Lenders must be prior approved and  maintain set criteria to participate in the program  ( www.IowaFinanceAuth...
FirstHome Program <ul><li>Not Only  for first-time homebuyers (FTHB): </li></ul><ul><ul><li>86 targeted counties  - FTBH n...
FirstHome Program Mortgages <ul><li>FHA: </li></ul><ul><ul><li>203b, 203c,  203ks (purchase + streamline rehab up to $35,0...
FirstHome Recapture <ul><li>May be subject to a “recapture tax”  IF </li></ul><ul><ul><li>Sold home within first 9 years; ...
FirstHome Recapture  <ul><li>“ maximum recapture” is lesser of  </li></ul><ul><ul><li>(A) adjusted 6.25% schedule  </li></...
FirstHome Recapture - Example <ul><li>Sale in 4 th  year at $96,000 </li></ul><ul><li>FirstHome mortgage $90,000  (& had p...
FirstHome Plus  <ul><li>$2,500 grant with FirstHome mortgage for household income at $49,600 (80% AMI) or less  </li></ul>...
Military Home Ownership Assistance   <ul><li>$5,000 grant  </li></ul><ul><ul><li>for prior approved down payment or closin...
Title Guaranty Certificate <ul><li>Title Guaranty is title insurance issued in Iowa </li></ul><ul><li>Lender’s coverage pr...
Title Guaranty vs. Title Insurance <ul><li>Title Guaranty:  </li></ul><ul><li>Benefits Iowa economics </li></ul><ul><li>Ex...
Septic System – low cost funds <ul><li>On-site Wastewater Assistance Program (OSWAP) </li></ul><ul><li>Loan for the replac...
Iowa Mortgage Help <ul><li>Homeowners call:  </li></ul><ul><li>877-622-4866 </li></ul><ul><li>or  </li></ul><ul><li>Comple...
Contact Information <ul><li>Stephanie Preusch </li></ul><ul><li>Iowa Home Ownership Education Project </li></ul><ul><li>ww...
Questions????? Thank you! www.IowaFinanceAuthority.gov [email_address] 515-725-4900
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Homeownership Programs from Iowa Finance Authority

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Homeownership Programs from Iowa Finance Authority

  1. 1. Home Ownership Programs Presented by Irene Hardisty Single Family Production Director
  2. 2. <ul><li>FirstHome Program </li></ul><ul><ul><li>first mortgage </li></ul></ul><ul><ul><li>grant (Plus) </li></ul></ul><ul><li>Military Home Ownership Assistance </li></ul><ul><ul><li>grant </li></ul></ul><ul><li>Title Guaranty Certificate </li></ul><ul><ul><li>Home Owner’s Certificate </li></ul></ul><ul><li>On-site Wastewater Assistance Program (OSWAP) – “septic system funding” </li></ul><ul><li>Iowa Mortgage Help hotline </li></ul>IFA Home Ownership Programs Be a partner with IFA in providing affordable homeownership opportunities!
  3. 3. <ul><ul><li>Lenders must be prior approved and maintain set criteria to participate in the program ( www.IowaFinanceAuthority.gov ) </li></ul></ul><ul><ul><li>SRP: IFA pays participating lenders > 1.75% or $1,000 for mortgage purchased </li></ul></ul><ul><ul><ul><li>Lender income is restricted to the SRP and up to $250 closing/settlement fee if the lender is the closing agent. </li></ul></ul></ul><ul><ul><li>P. Lenders have delegated authority for underwriting and pre-closing MRB compliance review. </li></ul></ul><ul><li>Lender options for participation: </li></ul><ul><ul><ul><li>Participating Lender* </li></ul></ul></ul><ul><ul><ul><li>Participating Correspondent Lender * </li></ul></ul></ul><ul><ul><ul><li>Third-party Participating Lender * </li></ul></ul></ul><ul><ul><ul><li>Third-party sourcing lender </li></ul></ul></ul>Lender participation in IFA Homeownership Programs
  4. 4. FirstHome Program <ul><li>Not Only for first-time homebuyers (FTHB): </li></ul><ul><ul><li>86 targeted counties - FTBH not required </li></ul></ul><ul><ul><li>Veteran exemption from FTBH requirement </li></ul></ul><ul><ul><li>13 counties must be FTBB: </li></ul></ul><ul><ul><ul><li>no real estate ownership interest in primary residence for last 3 years. </li></ul></ul></ul><ul><li>Purchase price limits: </li></ul><ul><ul><li>Targeted areas: $289,000 (86 counties) </li></ul></ul><ul><ul><li>Non-Targeted: $237,000 (13 counties) </li></ul></ul><ul><ul><ul><li>Must establish FTHB – no real estate ownership interest in primary residence for last 3 years. </li></ul></ul></ul><ul><li>Household income limit: 115% AMI </li></ul><ul><ul><li>by family size 1-2 person & 3+ and per county (see brochure) </li></ul></ul><ul><li>Property: </li></ul><ul><ul><li>1 unit purchase for primary residence </li></ul></ul><ul><ul><li>Generally limited to 5 acres and > 15% sq.ft. for business use </li></ul></ul><ul><ul><li>Personal property purchase may not be financed with mortgage </li></ul></ul><ul><li>Eligible for $8,000 Federal Tax Credit </li></ul>
  5. 5. FirstHome Program Mortgages <ul><li>FHA: </li></ul><ul><ul><li>203b, 203c, 203ks (purchase + streamline rehab up to $35,000) </li></ul></ul><ul><li>RD 502 Guaranteed </li></ul><ul><li>VA Guaranteed </li></ul><ul><li>Conventional: </li></ul><ul><ul><li>MyCommunity Mortgage, HomePossible or standard conventional </li></ul></ul><ul><ul><li>Secondary market fee for Fannie Mae loan level price adjustment and adverse market fee </li></ul></ul><ul><li>Fixed, fully amortizing, 30 year term </li></ul><ul><li>Restricted to reasonable and customary third party fees but not fee for lender outsourced services (e.g. note & mortgage doc prep. fee) </li></ul><ul><li>If settlement agent, lender may collect $250.00 closing fee </li></ul><ul><li>NO origination fee or discount points </li></ul><ul><li>Title Guaranty is the required title insurance </li></ul>
  6. 6. FirstHome Recapture <ul><li>May be subject to a “recapture tax” IF </li></ul><ul><ul><li>Sold home within first 9 years; </li></ul></ul><ul><ul><li>Incomes >5%/year above the MRB household limit in effect when the FirstHome mortgage closed; AND </li></ul></ul><ul><ul><li>Have gain on the sale of the house. </li></ul></ul><ul><li>Yes No </li></ul><ul><li>Yes No </li></ul><ul><li>Yes No </li></ul><ul><li>FirstHome - federally subsidized by tax exempt bond financing </li></ul>Need 3 “Yes’s” for Recapture to apply!!!!!!!
  7. 7. FirstHome Recapture <ul><li>“ maximum recapture” is lesser of </li></ul><ul><ul><li>(A) adjusted 6.25% schedule </li></ul></ul><ul><ul><li>or (B) 50% gain on Sale </li></ul></ul><ul><li>Mortgage X 0.0625 X year adjustment X income % (adj. personal income/ adj. income cap) = _(A)_ </li></ul><ul><li>Sale price – original purchase price – improvements + sale costs= gain on sale X 0.50 = _(B)_ </li></ul><ul><li>6.25 adjustment schedule: </li></ul><ul><li>1 st year: 20% </li></ul><ul><li>2 nd year: 40% </li></ul><ul><li>3 rd year: 60% </li></ul><ul><li>4 th year: 80% </li></ul><ul><li>5 th year: 100% </li></ul><ul><li>6 th year: 80% </li></ul><ul><li>7 th year: 60% </li></ul><ul><li>8 th year: 40% </li></ul><ul><li>9 th year: 20% </li></ul><ul><li>10 th year: - -0- </li></ul><ul><li>Work with their tax preparer (IRS form 8828) </li></ul>
  8. 8. FirstHome Recapture - Example <ul><li>Sale in 4 th year at $96,000 </li></ul><ul><li>FirstHome mortgage $90,000 (& had purchased at $90,000) </li></ul><ul><li>(A) 90,000 X .0625 X .80 = $4,500 </li></ul><ul><li>(B) 96,000 – 90,000 – 6,310 = no gains </li></ul><ul><li>“ B” = no recapture </li></ul><ul><li>IF “gains” – remember lesser of 50% gains (B) or income calculation (A) </li></ul><ul><li>If income below 1.05% appreciation table – no recapture </li></ul>
  9. 9. FirstHome Plus <ul><li>$2,500 grant with FirstHome mortgage for household income at $49,600 (80% AMI) or less </li></ul><ul><li>Mortgage interest rate is slightly higher </li></ul><ul><li>No matching funds needed </li></ul><ul><li>For down payment, closing costs or prior approved minor repairs. </li></ul>
  10. 10. Military Home Ownership Assistance <ul><li>$5,000 grant </li></ul><ul><ul><li>for prior approved down payment or closing costs </li></ul></ul><ul><li>Military persons who have served 90 active duty days 9/11/01, surviving spouse or discharged due to medical injury. </li></ul><ul><li>MUST be purchasing primary residency in Iowa. </li></ul><ul><li>Home buyers eligible for FirstHome or FirstHome Plus must use FirstHome/FirstHome Plus. </li></ul><ul><li>IFA participating lender must handle the request to IFA and close the loan. </li></ul>
  11. 11. Title Guaranty Certificate <ul><li>Title Guaranty is title insurance issued in Iowa </li></ul><ul><li>Lender’s coverage protects the Lender </li></ul><ul><li>Owner’s coverage protect the homebuyer </li></ul><ul><li>Low cost - $110 includes lender and owner certificate (“insurance”) </li></ul><ul><li>Free Owner’s Title Guaranty fee with issuance of Lender’s Title Guaranty. </li></ul><ul><li>Rapid TG Certificate – final policy within 3 weeks </li></ul>
  12. 12. Title Guaranty vs. Title Insurance <ul><li>Title Guaranty: </li></ul><ul><li>Benefits Iowa economics </li></ul><ul><li>Excess revenue goes to support to affordable home ownership for Iowans (Plus grant) </li></ul><ul><li>Final title policy in weeks – saves the lender time & overhead costs of “chasing down” final abstracting, attorney opinion and final policy! </li></ul><ul><li>Affordable: </li></ul><ul><ul><li>Lender $110 basic </li></ul></ul><ul><ul><li>Homeowner - free </li></ul></ul><ul><li>Title Insurance </li></ul><ul><li>Benefit economies in other states </li></ul><ul><li>No donation of funds to Iowa homebuyers </li></ul><ul><li>Final policy after satisfaction of seller’s mortgage, abstractor updates title and attorney provides final opinion. </li></ul><ul><li>Affordable to lender </li></ul><ul><li>No option for homebuyer except large fee </li></ul>
  13. 13. Septic System – low cost funds <ul><li>On-site Wastewater Assistance Program (OSWAP) </li></ul><ul><li>Loan for the replacement of inadequate or failing septic systems (existing property) </li></ul><ul><li>Property located in unincorporated area </li></ul><ul><li>Existing homeowner or coordinated in conjunction with purchase of home </li></ul><ul><li>Minimum loan amount of $2,000, maximum 3% interest rate, up to 10 years repayment </li></ul><ul><li>Loan is accessed through OSWAP participating lender </li></ul><ul><li>www.IowaFinanceAuthority.gov ; Water Quality Programs </li></ul><ul><li>[email_address] or 800-432-7230 </li></ul>
  14. 14. Iowa Mortgage Help <ul><li>Homeowners call: </li></ul><ul><li>877-622-4866 </li></ul><ul><li>or </li></ul><ul><li>Complete an on-line application at </li></ul><ul><li>www.IowaMortgageHelp.com </li></ul><ul><li>A counselor will contact the client within two business days, but usually sooner. </li></ul>
  15. 15. Contact Information <ul><li>Stephanie Preusch </li></ul><ul><li>Iowa Home Ownership Education Project </li></ul><ul><li>www.ihoep.com </li></ul><ul><li>515-229-7737 </li></ul><ul><li>[email_address] </li></ul><ul><li>Julie Noland </li></ul><ul><li>Iowa Finance Authority </li></ul><ul><li>515-725-4916 </li></ul><ul><li>[email_address] </li></ul>
  16. 16. Questions????? Thank you! www.IowaFinanceAuthority.gov [email_address] 515-725-4900

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