Archive for July 2009
Comments off · Posted by kara in Real Estate Insights
Rhode Island Neighborhood Stabilization Program (NSP)
In an effort to stabilize communities and offer assistance with redevelopment of abandoned and foreclosed homes, state of Rhode Island received $19.6 million under the Housing and Economic Recovery Act of 2008 (HERA). Of the total allocation of $19.6 million $2.89 million is available for home buyer assistance. This program offers up to 20% of the purchase price to eligible homebuyers acquiring an eligible property in the eligible NSP designated area.
- Eligible buyers may receive up to 20% in down payment assistance in form of a deferred-payment subordinate lien. (The payment is deferred, a portion of the lien is forgiven after 5 years and the remainder forgiven at a rate of 20% per year up to year 10. In case of a sale or transfer of title during the first 5 years the lien, principal and accrued interest is due and payable.)
- Receive 100% financing in form of an 80/20 loan ( the 20% second lien with deferred payment)
- If eligible may also receive the $8000 1st time home buyer credit.
Must purchase and occupy a foreclosed residential property in the NSP target areas(Map available).
*NSP target areas are currently hardest hit by foreclosures and delinquencies, with the highest percentage of subprime financed homes and is identified as likely to experience a significant increase in the number of foreclosures among others.
- 1-4 Family foreclosed/bank owned property located in NSP designated area.
- NOTE: Condominiums do not qualify.
- The property must be acquired at a minimum of 10% below the fair market value.
- NSP eligible properties must meet federal lead conformance requirements.
- 203 K loan can be utilized for rehabilitation for properties in need of more than $5,000 in repairs.
- Borrowers must complete a minimum of 8 hours of homebuyer education conducted by the Housing Network of Rhode Island. If buying 2-4 family home then completion of Landlord Tenant homebuyer education classes required.
First Homes Income Limits
- Household of 1 or 2 person = $87,400
- Household of 3+ person = $102,400
Purchase Price Limits
1 – 4 family = $417,000
(Purchase Limit is increased to $450,000 in a Rhode Island Housing First Homes Targeted Area)
*Eligible households seeking financing through a non Rhode Island Housing Program must have household income at or below 120% of area median income and seek counseling from RI Housing Help Center.