CHAPTER 160
HOMEOWNERSHIP ASSISTANCE PROGRAM (REPEALED)

Part I
Program Summary

13VAC5-160-10. Program summary. (Repealed.)

Responding to critical housing problems facing the Commonwealth, as documented in the 1987 Annual Report of the Virginia Housing Study Commission, the Governor and the General Assembly established the Virginia Housing Partnership Revolving Loan Fund. The purpose of the Fund is to increase the availability of decent and affordable housing for low- and moderate-income Virginia residents. The Homeownership Assistance Program provides low-interest loans from the Virginia Housing Partnership Fund. The purpose of this program is to increase homeownership opportunities for Virginia's low and moderate-income residents through the provision of affordable financing.

Part II
Definitions

13VAC5-160-20. Definitions. (Repealed.)

The following words and terms when used in these guidelines shall have the following meaning unless the context clearly indicates otherwise.

"Applicant" means a for-profit, nonprofit or governmental entity making an application or proposal under these guidelines.

"Application" means a written request to the Department of Housing and Community Development by a prospective applicant to the program on such form as the department shall provide.

"Area median income" means the median income established by the U.S. Department of Housing and Urban Development from time to time for various areas of the Commonwealth.

"Borrower" means an individual or individuals or organization who has applied for and received a commitment of funds.

"Fund" means the Virginia Housing Partnership Revolving Loan Fund.

"Program" means the Homeownership Assistance Program.

"Project" means houses within a defined geographic area which are receiving funds under the program.

Part III
Purpose and Applicability

13VAC5-160-30. Purpose and applicability. (Repealed.)

The purpose of the Homeownership Assistance Program (HAP) is to increase the supply of housing and homeownership opportunities for low- and moderate-income Virginians. Program funds will be available to projects involving financing of new homes and downpayment assistance on existing homes.

There will be emphasis on creative uses which result in the most effective use of resources in providing decent housing at an affordable cost to lower-income Virginians. The program shall be used to encourage partnerships with both public and private sectors including nonprofit, local government and for-profit organizations. The goal is to maximize the variety of resources used to solve housing problems of lower-income Virginians.

Part IV
Eligible Applicants, Applications and Activities

13VAC5-160-40. Eligible applicants. (Repealed.)

A. Nonprofit organizations incorporated under the laws of the Commonwealth Virginia;

B. For-profit entities;

C. Governmental entities including local redevelopment and housing authorities.

13VAC5-160-50. Eligible applications. (Repealed.)

Eligible applicants may submit more than one project in the same application provided the total request for all projects does not exceed $500,000.

13VAC5-160-60. Eligible activities. (Repealed.)

Eligible uses include:

1. Primary financing (e.g., 1st deed of trust permanent mortgages; lease/purchase);

2. Secondary financing (e.g., downpayment assistance, 2nd deed of trust gap mortgages);

3. Development and construction financing.

All projects funded must serve households with incomes at or below 80% of the area median income.

Part V
Distribution and Uses of the Fund

13VAC5-160-70. Funding allocations. (Repealed.)

The Commonwealth may reserve a portion of funds for one or more of the listed eligible activities pursuant to requirements of the funding source. Funds are awarded annually through a competitive process. Applications may be funded in the full amount of the request or a portion thereof.

13VAC5-160-80. Maximum fund reservations. (Repealed.)

The maximum request per sponsor is $500,000. The maximum request for downpayment assistance activities shall be limited to $75,000. Any funds remaining after initial reservations may be awarded to approved sponsors based on performance and availability of funds.

13VAC5-160-90. Geographic distribution. (Repealed.)

The Commonwealth will seek an equitable geographic distribution of funds.

Part VI
Loans Terms

13VAC5-160-100. Loan-to-value. (Repealed.)

Loans for primary and secondary financing shall not exceed 100% of the appraised value of the property. Construction and development loans shall not exceed 80% of the appraised value of the property.

13VAC5-160-110. Term of loans. (Repealed.)

Maximum loan terms may be determined by the Commonwealth based on the type of assistance. However, the term shall be no more than 15 years.

13VAC5-160-120. Interest rate. (Repealed.)

The interest rate shall be determined based on the type of assistance but in no case shall be less than 3.0%.

13VAC5-160-130. Deferrals. (Repealed.)

Deferral of principal payments or of both principal and interest payments may be allowed for up to three years. However, such deferrals do not extend the maximum 15-year term.

Part VII
Project Design

13VAC5-160-140. Project design. (Repealed.)

The applicant must detail the need for the proposed project, the availability of sites/units, financial data for the project and evidence of commitment of other necessary financing.

13VAC5-160-150. Eligible borrowers. (Repealed.)

Households purchase home shall include individuals and families with total household income that does not exceed 80% of the area median income. Individuals or organizations receiving funds for development or construction must meet the requirements of Part IV (13VAC5-160-40 et seq.).

13VAC5-160-160. Eligible projects. (Repealed.)

A. New homes. The applicant must have a specific site identified; i.e. subdivision or neighborhood. The sales price of the properties must be affordable to the population identified to be served. Cost analysis shall be computed to indicate feasibility of project and the need for HAP funds. Projects may include development, construction, primary and/or secondary financing.

B. Existing homes. HAP funds may be used for only downpayment assistance for sale of existing houses. The applicant must target a service area (not larger than a city or county) identifying a pool of available houses, the need for such a program and evidence of availability of permanent financing.

Part VIII
Evaluation Criteria

13VAC5-160-170. Criteria. (Repealed.)

Projects will be evaluated based on:

1. Income level of households served. The Commonwealth will give priority to those projects serving the lowest income households.

2. Leveraging HAP funds with other resources. Priority will be given to projects which have the higher amounts of other public/private funds.

3. Project design.

a. Affordability. Projects will be evaluated based on cost of housing compared with income of households served.

b. Readiness. Priority will be given to projects that are ready to proceed with construction activities or which have houses available to sell.

c. Types of assistance. Priority will be given to projects which make the best use of the funds based on evidenced need.

4. Sponsor experience. Priority will be given to projects which have experience in construction or financing on homes, or both.