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IT’S TIME TO REFRESH YOUR KNOWLEDGE!Thursday, February 7, 2019 - Monroe Country ClubMBARochester.COM
2/5/2019First Home ClubEligible Households Must be mortgage ready. Must meet the definition of a first-time homebuyer Have not had ownership in a primary residence for the last 3 years. This alsoincludes a spouse. A displaced homemaker who has only owned a principal residence with aspouse. An individual who has only owned a property that was not affixed to apermanent foundation. Must complete homebuyer counseling.1
2/5/2019Employment Requirements Borrowers must have 2 year history of full time employment from whichthey receive a reliable stream of income. Must not be actively enrolled in college including a Masters Degree, unlessthis is a requirement of their job. What constitutes income? Primary and secondary jobs. Household members that work multiple part timepositions must work a minimum of 32 hours weekly combined. Seasonal employment with unemployment while not working Social Security including income received to benefit a child Pension Income Disability IncomeIncome Limits Must have a household income of 80% or less of the area median fortheir current place of residence. 62,240.00 for a 1-2 family household 71,576.00 for a household of 3 or more Household members include all parties that will be residing in the new home,to included spouses, significant others, children, parents, grandparents. All sources of income to be included in determining the household is withinthe income guidelines of the program2
2/5/2019Savings Plan Borrowers will be required to complete a savings plan for a minimumof 10 months. 1 deposit per month for 10 consecutive months must be made withno missed deposits. No withdraws can be made from the dedicated savings accountunless the funds are being used for: Home Inspection; EarnestDeposit; Application Fees and Homeowners Insurance. If the borrower puts an earnest deposit on a home that falls through,they will be required to return the funds to the savings account within30 days.3
2/5/2019SONYMA UNIVERSITYFeatures of SONYMA FinancingFebruary 5, 2019February 5, 20192Why WOULD a LenderRecommend SONYMAFinancing?21
2/5/2019February 5, 20193A Look at the Current SONYMA ratesFebruary 5, 20194Benefits to Lenders & Borrowers No minimum creditscore Can accept 100% nontraditional credit Can use a guarantor(not Non Occ CoBorrower) Just 1 income-earningborrower must meet thecredit requirements 40%/45% Ratios Accept verified IBRpayment (even 0).Use 1% for deferred Deduct Child SupportPaid from Income vs.using as a Debt2
2/5/2019February 5, 20195Benefits to Lenders & Borrowers Low Down PaymentRequirements (97%1&2, 90% 3-4 units) Only 1% of purchaseprice must beborrowers own funds3% 3-4 units & coops Grants, Gifts, SellerContributions Allowed NO CLTV Restrictions Down Payment andRenovationAssistanceFebruary 5, 20196Down Payment Assistance Loan Assistance is optional and available with all SONYMA loanprograms regardless of LTV or available assets0% interest, 2nd mortgage; requires no monthly paymentEqual to the greater of 3,000 or 3% of the Purchase Price, notto exceed 15,000When DPAL exceeds the minimum down payment (purchaseprices less than 100,000), excess may be credited to closingcostsDPAL may be used alternatively to finance a singlepremium MI, thus eliminating MI from the monthlypayment and making qualifying easier.DPAL increases SONYMA’s standard rate by .375% (with 2exceptions!)63
2/5/2019February 5, 20197RemodelNY/NRP Creating New OpportunitiesFebruary 5, 20198What is a RemodelNY Renovation Loan? A renovation loan that allows the borrower topurchase a home AND pay for improvements The money for the work goes in an escrowaccount at closing, administered by SONYMA The money is disbursed as the work is completedand inspected through requests to SONYMA4
2/5/2019February 5, 20199The Basics Max 97% of Purchase Repairs Contingency Payments Certain Fees OR Appraisal (if less) Homebuyer education required Fully disbursed at closing 1,000 minimum repairs SONYMA Credit Guidelines Can be combined with DPALFebruary 5, 201910Eligible Properties 1-4 Units HUD/Bank Repos Existing homes complete for at least 5 years PUDs, Condos & Co-ops (if associationapproves the repairs)2/5/20195
2/5/2019February 5, 201911NRP (Neighborhood Revitalization) Typically Tied to RemodelNY program Offers a 20,000 forgivable loan for renovationsto a vacant property Helps cover “gaps” in renovation funding Must buy a property within Monroe County Requires a FHA 203K Consultant or non-profitpartner consultant (GRHP in Rochester)February 5, 201912NRP “Taxable” First Time Homebuyer Requirement Waived Borrower MUST owner occupy Borrower can own other property at loanclosing Has Higher Income Limits Uses Low Interest Rate Program Rate6
2/5/2019February 5, 201913February 5, 201914Typical Renovation SituationSample Transaction:Appraised Value: 180,000Purchase Price: 150,000If After Improved Value is less thanTotal Repairs: 40,000Cost Reno, then max loan amountis 97% of value.Soft Costs: 7,500Total Costs: 197,500NRP Funds:- 0.00Appraised Value 180,000 x .97Max Loan Amount: 174,6007
2/5/2019February 5, 201915Using NRP for RenovationSample Transaction:Purchase Price: 150,000Total Repairs: 40,000Soft Costs: 7.500Total Costs: 197,500NRP Funds:- 20,000Cost after Subsidy 177,500 x .97Max Loan Amount: 172,175Appraised Value: 180,000If After Improved Value is less thanCost after Subsidy then max loanamount is 97% of value.February 5, 201916SIDE BY SIDE COMPARISONWITH NRPWITHOUT NRP Cash Needed: 47,500Subsidy- 20,000Loan Proceeds:- 22,175*Net Cash 5,325 *Loan proceeds Max Loan Amount MINUSthe property Purchase PriceCash Needed:Subsidy:Loan Proceeds:Net Cash: 47,500 000- 24,600 22,9008
2/5/2019February 5, 201917Other NRP Option Eligible HOME Rochester buyer using aSONYMA mortgage to purchase a propertyrecent renovated through RHDFC mayreceive the 20,000 NRP funds to offset thecost of development when it exceeds marketvalue. Funds are received at closing and paid toRHDFCFebruary 5, 201918Example Development Cost: 155,405City of Rochester CHODO 43,405NYS AHC Subsidy 30,000SONYMA NRP 20,000Net Purchase Price: 62,0009
2/5/2019February 5, 201919Local Participating SONYMA Lenders 1st Priority MortgageCitizens Bank, N.A.Family First Federal Credit UnionFive Star BankHomestead Funding*Key BankM and T Bank*Premium Mortgage*Reliant Community Federal Credit UnionResidential Mortgage Services (RMS)*SEFCU Mortgage Services*Tompkins Bank of Castile*Wells Fargo Bank, N.A.* These Lenders currently offer Renovation/NRP lendingFebruary 5, 201920KNOW THE WEB: WWW.SONYMA.ORG Lenders Home Page: (www.nyshcr.org/Topics/Lenders/Lenders/) nformationforLoanOfficers.htm)for Loan OfficersCurrent Interest yhomesPrograms.htm)Product Comparison Chart ComparisonOfMortgagePrograms.htm)And a whole HOST of additional information at your fingertips including RealtorFAQ’s, printable flyers and MORE!10
2/5/2019February 5, 201921Your Interim SONYMA BusinessDevelopment OfficerBill Teague: 518-573-5936, William.Teague@nyshcr.orgCurrently Covering Upstate New YorkORCall our General Information Line .800-382-HOME (4663) for furtherdirection!February 5, 201922Questions?11
2/5/2019PathStone Corporation FirstTime HomebuyerGrant & Loan ProgramsPresented by:Tonia Jay GrafSenior Homeownership CounselorPathStone’s Housing Counseling Program HUD Certified Non Profit HousingCounseling Agency We are here to educate the communityon all housing related issues Pre Purchase Education and CounselingPost Purchase EducationForeclosure Prevention CounselingHECM CounselingLandlord/ Tenant Services1
2/5/2019PathStone LocationsThe Housing Council at PathStone, Inc.75 College Ave, 4th FloorRochester, NY 14607585-546-3700PathStone Corporation – Batavia301 North St, Suite 10Batavia, NY 14020585-343-2188PathStone Corporation – Canandaigua5297 Parkside Dr, Suite 410Canandaigua, NY 14424585-396-3400Monroe County, NYThe County of Monroe supports The Housing Council atPathStone’s First Time Homebuyer Education and CounselingProgram, which includes grants for low to moderate incomehouseholds who wish to purchase in a home in suburbanMonroe County.Grant are used for down payment, closing costs, pre-payablesand interest buy down. This is combined with an affordablemortgage product.2
2/5/2019BASIC QUALIFICATIONS First Time Home Buyer- must not have owned a home inthe last 3 years prior to purchase. Income – cannot exceed 80% of HUD’s area medianincome determined by household size. Property - must be purchased in Monroe County, outsidethe City of Rochester.Monroe County , NY Grant Program*Income Limits (10/2018)Household SizeMaximum Income1 41,4502 47,4003 53,3004 59,2005 63,9506 68,7007 73,4508 78,150* Subject to change annually3
2/5/2019Program Eligibility Criteria Gross household income from all sources to determine grant eligibility Credit score of 620 or higher required A minimum of 1,500 of buyer’s own funds are required Completion of Homebuyer Education is required Must have grant award letter BEFORE entering into purchase contract Maximum purchase price : 135,000Maximum Mortgage Qualifying Ratios: 30% Housing and 43% TotalDebt Ratio Must reside in the home 5 years Award Amount The grant award is allocated on a sliding scale based on income Grant amount will be determined by the cost of the followingfees as shown on the Loan Estimate– Appraisal fee– Flood certification– Credit report– Tax services– Recording fee– Transfer fee– Upfront MIP– A portion of down payment IF income eligible Minimum grant award is 3,000 maximum is 8,0004
2/5/2019Application Process1.2.5.Attend one of our monthly orientations, applications are available.The application is also available on our website:www.thehousingcouncil.org or by calling our office at 546-3700.Applicant must complete application and supply us with all theapplicable documentation from the document check-list page # 3.Client meet with a housing counselor for a one-on-one counselingsession.Client receives pre-approval letter for grant/subsidy.6.Client completes Homebuyer Education.7.Subsidy Award Letter is mailed out to client.3.4.Purchase Contract A purchase contract is written with contingency clause:“subject to receiving closing cost assistance from TheHousing Council at PathStone” Attorney approval required Purchase & Sale Contract AND Attorney approval lettersubmitted to The Housing Council5
2/5/2019Required Inspection A home inspection report must be submitted to The HousingCouncil for review immediately after completion. Timeline forreview is up to 7 days. The Housing Council reviews for health and safety issues PERHOME GUIDELINES**– Peeling paint– Electrical issues– Furnace cleaned and tuned An action plan letter is sent to client & realtor advising seller ofrequired repairs**All receipts of completed repairs submitted to The HousingCouncil for review and for the file**Other Requirements From Realtor & Seller * Relocation Notice Debarment Notice Housing Quality Standards Inspection- (can be done by anylicensed home inspector) Visual examination of exterior and interior painted surfaces*Counselor will provide all of these documents that are acomponent of the award letter and will come with instructions6
2/5/2019Required Documentation from Lender Loan Estimate- verifying fees and amounts 1003- verifying housing and debt ratios Appraisal – verifying value Mortgage Commitment Letter – approvalPreparing for Closing1.The Housing Council prepares Note and Mortgage with grant amount2.Client comes into The Housing Council to sign and have documentsnotarized3.The Housing Council prepares final package and hand delivers toMonroe County office4.Monroe County gives final approval5.Check request is processed through The Housing Council financedepartment for closing7
2/5/2019Questions?Monroe County GrantNYS AHC Acquisition Rehabilitation Grant Must be a First Time Homebuyer Income eligibility based upon household size andincome not to exceed 80% of HUD area medianincome within county of purchase, with priorityfor households below 50% HUD AMI. 30,000 grant (split between repairs up to 25,000 and closing cost assistance). PathStone Rehabilitation and Energy Servicedstaff sets work scope for repairs and sends out forbids to approved contractors Participating lenders: Five Star Bank, The Bank ofCastile and USDA 502 Program. Available in Genesee & Monroe Counties8
2/5/2019Loan Requirements Must be combined with an affordable mortgage product Funds can be used for down payment, closing costs, orprepaids Loan is secured to the property (Note & Mortgage filed) Must complete 8 hours of homebuyer education throughPathStone or another HUD approved counseling agency. Acertificate of completion is required. Loan can be combined with other programsQuestions?AHC Grant9
2/5/2019Loan Application Process Contact Jay Elmore at 585-340-3387 or jelmore@pathstone.orgItems need from applicant(s) Federal Tax Returns and W2’s for the past two years 1 Month of Paystubs 3 Months of Bank Statements Child Support documentation Letters of Explanation, if applicable Separation Agreement or Divorce Decree Purchase offer and all addendums Copy of Home Inspection Copy of Homebuyer Education Certificate or contact a PathStoneoffice to register for a class Any other documentation needed for approvalDocuments Required from Lender for Loan Copy of 1003Verification of Rent & EmploymentCopy of AppraisalCopy of Flood CertificationBank Attorney Name & Contact InformationCopy of Bank Mortgage Commitment10
2/5/2019Homebuyer Education In-person classes held at PathStone locations. Pleaseregister in advance Online education is estions?11
2/5/2019City of RochesterHome Buyer ProgramCity of RochesterHOME PURCHASE ASSISTANCE PROGRAMThe HOME Purchase Assistant Program (HPAP) providesdown payment and closing cost assistance to first-timeCity buyers who meet program requirements.Grants of up to 3,000 areavailable forclosings costs forhome offered onthe privatemarket.120% MedianFamily Incomelimits.Compatible withNRP and otherRepair programs1
2/5/2019City of RochesterEMPLOYER ASSISTED HOUSING INITIATIVEThe Employer Assisted Housing Initiative Program (EAHI):an incentive for private employers to encourage theiremployees to purchase homes in the City of Rochester.Funds ofdesignatedemployers arematched withCity funds forclosings costs forhome offered onthe privatemarket.In some casesparticipatinglenders will alsomatch grantfunds.NO incomemaximums ineffect.Compatible withNRP and otherRepair programsCity of RochesterEMPLOYER ASSISTED HOUSING INITIATIVE EmployerPartners City of RochesterEastman KodakHighland Hospital (in designated neighborhoods, 5/year)Hillside Family of Agencies (designated neighborhoods,5/year)Rochester City School District (waiting list, 10/year)Rochester Institute of Technology (10/year)Rochester Management Inc.Rochester Regional Health/Unity (10/year)Stantec Consulting ServicesUniversity of Rochester (in designated neighborhoods)Visiting Nurse ServicesWindstream/PAETEC Communications (in designatedneighborhoods)XEROX Corporation2
2/5/2019City of RochesterHOME ROCHESTER PROGRAMDown payment and closing cost assistance to first-time buyers whomeet program requirements. The HOME Rochester Program isadministered by the Greater Rochester Housing Partnership (GRHP).Subsidy for homesrehabilitatedthrough GRHP andup to 6,000 inclosing costs forpurchase of one ofthese homes.Individualsinterested in aHOME Rochesterproperty must beapproved by theCity and submit abuyer approvalrequest form to beadded to the list.Income limits ineffect (dependingon address)Residencyrequirement of 15years.Note: compatible with EAHI and with First Home ClubCity of RochesterELIGIBILITY & PROGRAM REQUIREMENTSBuyers must submit a HBSapplication and obtain approvalfrom HBS before executing apurchase offer (typically 4-5weeks)Applicants must not exceedincome limits.HPAP: up to 120% MFIHOME Rochester: 80%, 90%, or120%Credit requirements are flexiblebut generally require a 640middle score (Please avoidCreditKarma!)(N/A for EAHI applicants)Homes must be located in theCity of Rochester and must beone to four family propertiesBuyers must contribute at least 1,500 of their own fundsBuyers must live in the propertyfor five years after closing (fifteenyears for HOME Rochester)Buyers must qualify for aconventional, FHA, VA orSONYMA mortgage loanProgram is compatible with mostother grant programs, includingthe First Home ClubBuyers must attend pre-and postpurchase homebuyer trainingunless waived by HBS3
2/5/2019City of Rochester2018 – MEDIAN FAMILY INCOME (MFI) LIMITSFamily Size80%120%1 41,450 62,1502 47,400 71,0503 53,300 79,9004 59,200 88,8005 63,950 95,9006 68,700 103,0007 73,450 110,1008 78,150 117,200For each person in excess of eight, the four-person income limit should be multiplied by an additional eight percent (.08)City of RochesterELIGIBILITY & PROGRAM REQUIREMENTSNote: Keep all originals as the application and documents will NOT be returned and you will need them for your al security cardfor everyone inhousehold8 weeks consecutivecomplete pay stubsfor all householdmembers 18 or overLast 2 years’ full taxreturns AND W-2statements for all jobs orincome for all householdmembers 18 or overLetter of Eligibilityfrom participatingEmployer if eligible(EAHI Program)Photo ID forhousehold membersage 18 and OVERCopies showingdetails of all otherforms of incomeBank statements: Last 3months for all accountsCopies of documentsfor any other grantsor programs you haveapplied forBirth certificate forhouseholds membersUNDER age 18If self-employed:Current year-to-dateand prior year Profitand Loss statementRecent tri-mergecredit report fromlender (Optional)4
2/5/2019City of RochesterPROCESSI want ahouse!I found ahouse! Complete and submit application with all required documentation.City will review; currently a 4 week turnaround If eligible, meet for appointment with Program Manager to reviewgrant agreement and receive approval (currently within 1-2 weeksafter review). Will be referred for pre-purchase education if not already completed. Submit purchase offer and other required documents to HBS Apply for mortgage Applicant will also need to take Operating Rental Property course ifproperty is a double or moreCity of RochesterPROCESS (continued)I needmoney!When can Iclose? Apply for mortgage with preferred lender (concurrent with HQSinspection) Submit Mortgage commitment and Closing Cost Estimate documents City will request funds through financial system once previousrequirements are met and HQS inspection has passed. Once check funds available, City Law Department will contact Applicant’sattorney Attorneys will schedule closing and notify City City coordinates EAHI funds (if applicable)Note: typical timeline between Purchase Offerreceived by HBS and a closing date is 12 weeks.5
2/5/2019City of RochesterCITYRESPONSIBILITIES Ensure all documentation is correct, current, and in file Facilitate HQS Inspection; depending on response ofseller/seller’s realtor, typically within 4 weeks Process voucher and contract agreement (assumingapplicant is still in good standing) Contact applicant to come in to sign/notarize agreements Facilitate financial requirements with lender or otherstakeholders Notify Attorneys when funds are available Attend closing with City’s
SONYMA UNIVERSITY Features of SONYMA Financing February 5, 2019 2 Why WOULD a Lender Recommend SONYMA . Paid from Income vs. using as a Debt. 2/5/2019 3 February 5, 2019 5 Benefits to Lenders & Borrowers .
