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2010 Homeownership

If the applicant has owned a mobile home in the past regardless of how it was titled, ... To educate borrowers about the home buying process and provide additional educational ...

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2010 Homeownership

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  1. Ohio Housing Finance Agency 2010 Homeownership Programs

  2. OHFA Mission Statement “We open the doors to an affordable place to call home.”

  3. Ohio Housing Finance Agency Closed Loans to Ohio homebuyers: • 2005 over $ 550 Million • 2006 over $ 1.1 Billion • 2007 over $ 811 Million • 2008 over $ 711 Million • 2009 over $ 265 Million Over $9 billion in mortgages and over 140,000 Ohio households funded through OHFA

  4. LOAN PROGRAMS Program details: • Home purchase options: • Existing ( including condominiums) • Modular • Manufactured • Spec homes • New Construction

  5. First-Time Homebuyer Program Expanded eligibility • 1. Actual first-time homebuyers • Buyers who have not had an ownership interest in • a principle residence within the last 3 years • 3. Anyone including previous homeowners buying in a “Target Area” • 4. Veterans

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  7. LOAN PROGRAMS • Mortgage Revenue Bond (MRB) • Government Loans (FHA, 203K, VA, USDA-RD) • Conventional Loans • Financial Assistance Options • 2.5% Down payment assistance Grant • Grants for Grads Second Mortgage

  8. LOAN PROGRAMS Ohio Heroes program .25% Rate Reduction on current rate for: • Active Military • Veterans • Law Enforcement • Public Safety • Teachers • Healthcare • Full Time employment* • State license or Certification

  9. LOAN PROGRAMS • 30-year fixed rate loans* • Owner occupied, primary residence • Multifamily dwellings • 1 to 4 unit • Non-traditional credit permitted • Acreage limits • 2 acre limit within a municipal corporation • 5 acre limit outside a municipal corporation (Documented exceptions considered) Program details:

  10. LOAN PROGRAMS Government loandetails • 203 K & Streamline loans available • Loan draws held by loan servicer • 50% first draw approved (Up To) • Housing Choice Vouchers accepted as income (aka: Sec 8)

  11. LOAN PROGRAMS Conventional loandetails • Homebuyer education required • Fannie Mae • Adverse Market Fee equal to .25% of loan amount • 1% LLPA • Higher credit scores required

  12. LOAN PROGRAMS OHFA Credit Score Requirements: 600 without OHFA financial assistance 620 with OHFA financial assistance Credit Scores: 2006-07 average = 690 2009 average = 650 2010 first quarter average = 670

  13. OHFA Assistance Grant • Interest rate is .5% higher than unassisted mortgage rate. • Can be used for down payment or closing costs. • No requirement for repayment if home is sold. • Homebuyer Education required

  14. Ohio Housing Finance Agency Grants for Grads Second Mortgage Program

  15. Grants for Grads Second Mortgage Purpose of Program: Offer financial incentive to recent college graduates toward the purchase of a home in Ohio. Encourage our home grown talent to stay in Ohio.

  16. Grants for Grads Second Mortgage The Grants For Grads Program provides down payment assistance equal to 2.5% of the home purchase price in the form of a forgivable second mortgage. CURRENT MORTGAGE RATE:  5.0%

  17. Grants for Grads Second Mortgage Homebuyer Qualifications: First time homebuyer – no ownership interest in primary residence in prior three years Single family home purchases only Borrower to occupy home in 60 days of closing and use as a primary residence

  18. Homebuyer Qualifications Ohio Resident at time of High School Graduation Graduate from an Ohio High School, or Proof of parent’s residency at time of high school graduation GED not eligible at this time Graduate from any accredited college or university

  19. Homebuyer Qualifications College Graduation: Receive one of the following degrees within the 18 months from a college or university: - associate - bachelors - masters - doctoral Proof of graduation - Diploma from high school and college/university

  20. Grants for Grads Second Mortgage What about a degree from a “Technical College”? The Ohio Board of Regents has determined that a degree from an approved Technical College is equal to an associates degree.

  21. Grants for Grads Second Mortgage Program details: Interest rate is same as OHFA unassisted Rate (currently 5.0%) Homebuyer Education required Income limit is 140% of area median income Program cannot be combined with other OHFA down payment programs or Ohio Heroes.

  22. Grants for Grads Second Mortgage Loan Program Benefits: Zero Interest Deferred payment 2nd mortgage is forgiven over five years

  23. Grants for Grads Second Mortgage Repayment Repayment required if borrower moves out of Ohio within first five years. Repayment not required if borrower moves out of the house but stays in Ohio. Repayment not required if borrower sells the house but stays in Ohio.

  24. Ohio Housing Finance Agency Mortgage Credit Certificate (MCC) Program

  25. Current Guidelines • $2000 Maximum mortgage interest credit per year • Borrower must owe taxes to the IRS at the end of each year after deductions have been taken.

  26. Current Guidelines Annual tax credit rates: (20%) Credit for non-target areas (25%) Credit for target areas (30%) Real estate owned (REO) Credit is valid for each year of homeownership

  27. MCC Example $6,467.09 Annual Interest x % = yearly credit 20% 25% 30% $1293.42 $1,616.77 $1940.13

  28. Current Guidelines Applicants Must: • Use an OHFA participating lender • Qualify under the current First-Time Homebuyer Program guidelines

  29. Current Guidelines MCC Program Guidelines follow same guidelines as First Time Homebuyer Program Guidelines: • Ownership status of borrower • Purchase price of home • Total household income • Acreage

  30. Current Guidelines MCC Program Exceptions Ownership status of borrower* • If the applicant has owned a mobile home in the past regardless of how it was titled, (BMV or as real property) the applicant is considered to be a homeowner and is not eligible for the MCC program unless purchasing in a Target area. • One-unit single family home purchases

  31. Current Guidelines Two options for credit: • End of the year tax credit • Review IRS Publication 530 • Complete IRS Form 8396 • Adjusting W-4 withholding • See IRS publication 919 Buyers are strongly encouraged to consult a tax professional for advice on claiming the credit.

  32. Current Guidelines Lenders: • Must be able to originate, underwrite, close & fund loans • Will combine with their own loan product • Must use a “fixed rate” loan product • May permit borrower to buy-down the interest rate

  33. Current Guidelines Rate cannot be 100 basis points or more above the current Freddie Mac Primary Mortgage Market Survey (PMMS)

  34. Reservation & CommitmentTimeline Type: Reservation Commitment Existing 60 days 30 days New 90 days 60 days REO 120 days 90 days

  35. Ohio Housing Finance Agency Homebuyer Education Program

  36. OHFA Homebuyer Education Purpose: To educate borrowers about the home buying process and provide additional educational resources to improve their chances of success as a homeowner.

  37. OHFA Homebuyer Education Who is required to use Homebuyer education? OHFA borrowers requesting additional financial assistance from OHFA.

  38. OHFA Homebuyer Education Two options: Courses offered through HUD-approved housing counseling agencies -OR- OHFA Streamlined education program

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