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HomeOwnership Program Financing (HOP)
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Full-Cycle Lending
Process |
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Eligible properties: Single
family, owner occupied, principal residence. Property can be within
the City of Reading or in the Townships or Boroughs of Berks County.
Description: Standard fixed rate mortgage loan product offered to
first time homebuyers with incomes up to 105% of median income for
city properties; and for first time homebuyers with incomes up to 80%
of area median income for non-city properties.
See chart below.
Maximum Sales Price: $100,000.
Maximum C L-T-V: 120% of the lower
of the sales price or appraisal value with repair escrow, or 110%
without repair escrow.
Financing terms: Bank L-T-V:
Minimum of 80% of the lesser of the sales price or appraisal value
Amortization: 15, 20, 25 or 30
years (depending on the bank)
Interest: Banks quoted rate at
time of application
NHS – HOP L-T-V: 15% or 20% of the
lesser of the sales price or appraisal value for down payment, plus up
to $ 3,000.00 towards property repairs, plus closing cost in excess of
$1,500 of own funds, with a combined loan to value not to exceed above
guidelines.
Amortization: 5, 10, or 15 years
Interest: NHS quoted rate,
typically 4%.
Down payment: No down payment
required ($0)
Closing Cost: Borrower must have a
minimum of $1,500 of their own funds toward closing costs. The
remainder of the settlement/ closing cost may be from a gift and/or
seller contribution up to 6% of the sales price and/or up to 10% extra
from the NHS loan, once the minimum of borrower’s own funds
requirement has been met. Also Federal Home Loan Bank Home Equity Fund
can be used by borrowers meeting FHLB eligibility requirements in
combination with this program when it is available.
Points & Underwriting fee: None
charged by NHS
Private Mortgage Insurance: Not
required
Counseling: Pre-purchase homebuyer
counseling is mandatory. Budget counseling is mandatory and must be
provided to all borrowers. The borrower’s net income budget must
demonstrate the ability to save a minimum of $25.00 each month.
Income Qualifications: Not to
exceed 105% of HUD Median Income based on family size for City of
Reading properties; or not to exceed 80% of the HUD Median Income
outside the city.
Income Ratios: 33% - 38%
Property & Wood Infestation Inspections:
Required. Property Inspection completed by NHS Rehabilitation Specialist. All health and safety repairs
must be corrected prior to settlement if responsibility of the seller.
Or the borrower can borrow up to $3,000.00 to be held in escrow by NHS to complete repairs after closing. Wood infestation inspection
conducted by certified company of Buyer’s choice.
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2004 INCOME GUIDELINES |
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FAMILY SIZE |
Income Limits for Non-City Purchase
80% OF MEDIAN INCOME |
100%OF MEDIAN INCOME |
Income Limits for City Purchase
105% OF MEDIAN INCOME |
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1 PERSONS |
$34,550.00 |
$43,190.00 |
$45,350.00 |
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2 PERSONS |
$39,500.00 |
$49,360.00 |
$51,850.00 |
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3 PERSONS |
$44,400.00 |
$55,530.00 |
$58,300.00 |
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4 PERSONS |
$49,350.00 |
$61,700.00 |
$64,800.00 |
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5 PERSONS |
$53,300.00 |
$66,636.00 |
$70,000.00 |
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6 PERSONS |
$57,250.00 |
$71,572.00 |
$75,200.00 |
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7 PERSONS |
$61,200.00 |
$76,508.00 |
$80,350.00 |
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8 PERSONS |
$65,150.00 |
$81,444.00 |
$85,500.00 |
NHS Home Repair Loan
(Funded by National Penn bank)
Objective:
To provide timely access to capital to qualified Reading
homeowners for emergency and necessary home repairs.
Purpose:
To provide resources for maintaining the housing stock, enhancing the
appearance of neighborhoods, and allow families to remain in residence
(family stability).
Geographic Area:
City of Reading
Target Population:
Owner occupants of single family residential property; no income
requirements
Maximum Loan:
$5,000 maximum; $300 minimum (emergency work only)
Terms:
Up to 60 months @ 3% interest; unsecured
Eligible Uses:
1. Necessary repair work to home systems- plumbing,
heating, electrical, roofing, etc., as approved by NHS.
2. Façade improvements for neighborhood enhancement (NHS Target
Neighborhoods only)
3. Emergency repairs over $300.
4. No General Property Improvements (GPI
Other Factors:
1. No significant remaining health or safety issues
remaining
2. This loan assistance should not replace other sources of assistance
such as BCAPs Weatherization Program
Fees:
Application- $25-can be financed, if necessary
* NHS $7,000 Repair Loan can piggyback on NPB $5,000 loan in our
“target neighborhoods”
Public Professional Next
Door (PPND):
This program is initially limited to 3 NHS target neighborhoods. It
offers 100%+ financing at 3% fixed rate for 30 years for the purchase
of a home (primary residence) in our target neighborhoods, effective
April 15th. . General terms include:
Eligible borrowers are teachers of
the Reading School District, City fire fighters, and Berks County
active-duty police officers.
Homes must be located within the 3
target neighborhoods – 6th Ward, 15th Ward, and 10th ward
(resident/neighborhood areas, not ward boundaries)
The program may expand to additional
neighborhoods or go city-wide in the future, subject to demand and
funding.
Not restricted to first-time
homeowners; but must be only real estate owned.
Borrower Income may not exceed 105%
Area Median Income (approximately $65,000 for a family of 4).
Purchase price may not exceed
$100,000.
Borrower must provide minimum of
$1500 of own funds, balance may be financed at 3%/30 years or less.
Minimum of 3 years residency
required.
First-time homeowners will be
required to attend the homebuyer education program called FASTRAC;
this is a free course.
Borrowers must meet all other program
and underwriting requirements.
Neighborhood Boundaries and Target Areas for
Development
Dare 2 Care of the 15th Ward
Boundaries: Schuylkill River to the West; Robeson St. to the North;
Second Street to the East; Railroad Tracks (6th Ward Boundary) to the
South
Southeast Community Council
Boundaries: Seventh Street to the West; Penn/Perkiomen to the North;
City Line to the East and South.
Sixth Ward Concerned Citizens
Boundaries: Schuylkill River to the West; Lebanon Valley railroad
tracks to the North; Fourth Street to the East; Penn Street to the
South.
For more information, contact Susan Hufford, HomeOwnership Center
Manager at 610-372-8433, Ext. 212, or visit our office at 213 N. 5th
Street, Reading, PA.
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