10 Tex. Admin. Code § 23.70 - Homebuyer Assistance with New Construction (HANC) General Requirements
(a) Eligible Activities must meet the
ownership requirement in paragraph (1) of this subsection and an Activity
described in paragraph (2) of this subsection:
(1) Ownership requirement. A site must be
owned by the beneficiary or the HOME Activity must include one of the two
following Activities:
(A) Acquisition of
existing single family housing or a parcel; or
(B) Refinance of non-owner occupied real
property parcel not prohibited for single family housing by zoning or
restrictive covenants.
(2) All Activities must include New
Construction of a unit of single family housing not occupied by the Household
prior to assistance; New Construction described in this subsection includes the
purchase and installation of a new unit of Manufactured Housing (MHU).
(b) The unit of housing
in any of the Activities described in subsection (a) of this section must be
occupied by the assisted Household as their principal residence for a minimum
of 15 years from the Construction Completion Date.
(c) If the assisted property is owned by the
Household prior to participation, the Household must be current on any existing
Mortgage Loans and taxes, and the property cannot have any existing home equity
loan liens. HOME funds may not be utilized to refinance loans made or insured
by any federal program.
(d) Total
Project costs, exclusive of Match funds, are limited to the amounts described
in §23.27, Project Cost Limitations.
(e) Homebuyers may choose to obtain financing
for the acquisition or construction, or any combination thereof, from a
third-party lender so long as the loan meets the requirements of §
20.13 of this Title (relating to
Loan, Lien and Mortgage Requirements for Activities).
(f) Direct assistance will be structured as a
fully amortizing, repayable loan and will initially be evaluated at zero
percent interest. The minimum loan term shall be equal to the required federal
affordability period based on the HOME investment, and shall be calculated by
setting the total estimated housing payment (including principal, interest,
property taxes, insurance, and any other homebuyer assistance), equal to at
least the minimum required housing payment. Should the estimated housing
payment, including all funding sources, be less than the minimum required
housing payment for the minimum term, the Department may charge an interest
rate to the homebuyer such that the total estimated housing payment is no less
than the required minimum housing payment. In no instance shall the interest
rate charged to the homebuyer exceed five percent and such result may deem the
applicant as overqualified for assistance. The term shall not exceed 30 years
and not be less than 15 years.
(1) The total
Mortgage Loan may include costs incurred for Acquisition or Refinance, Mortgage
Loan closing costs, and Direct Activity Costs, exclusive of Match
funds.
(2) The total Debt-to-Income
Ratio shall not exceed the limitations set forth in Chapter 20 of this
Title.
(3) For buyers whose income
is equal to or less than 50 percent AMFI, the minimum required housing payment
shall be no less than 15 percent of the household's gross income. For
homebuyers whose income exceeds 50 percent AMFI, the minimum required housing
payment shall be no less than 20 percent of the household's gross
income.
(g) Earnest money
may be credited to the homebuyer at closing, but may not be reimbursed as cash.
HOME funds may be used to pay other reasonable and customary closing costs that
are HOME eligible costs.
(h) To
ensure affordability, the Department will impose recapture provisions
established in this Chapter.
Notes
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