Uses familiar programs: FHA, RD (FmHA),VA, Conventional (Fannie Mae)
Borrower selects the type of loan he wants to use, then applies and
closes when approved|
Lender accepts application, reserves funds, processes and approves
loan, as with regular book of business loans.|
At closing, lender funds loan and provides the 3% Cash Assistance
Payment to the
borrower, if that program is used|
After closing, lender submits files to MHDC and Master Servicer|
Recapture Tax applies in some cases when a home financed with Mortgage
Revenue Bond funds
is sold. For Recapture Tax to apply, the seller must meet all of the following
Sell the home within nine years.
Make a net profit on your home, after adjusting the value of the
home for any improvements or repairs you have made, and after deducting
all costs of sale, including sales commission, and
income must have increased at least 5% each year (on average).
Fear of paying
Recapture Tax should not cause you to forego use of the First Place
program. If you refinance your home at a later date to obtain a
better interest rate, or to use the equity you have in your home,
Recapture Tax provision is not triggered.
See Section 5 of
the Program Manual for detailed information concerning the Recapture Tax