North Suburban Consortium (“NSC”) offers Down Payment Assistance (“DPA”) loans to income-eligible First Time Home Buyers (one who has had no homeownership interest in a principal residence during the past 3 years OR a displaced homemaker or single parent who has only owned a home with a former spouse while married) (“FTHB”) purchasing a condominium, townhome or single-family property in one of the eight NSC communities. DPA loan can be used for down payment assistance and customary closing costs. However, it cannot be used for: reimbursement for previously paid earnest money down payment; funding monthly housing payment reserves requirements; prepayment of life insurance premiums; or to bridge the gap between purchase price and appraised value. Applicant cannot receive money back at closing. Applicant’s primary mortgage lender must fund the DPA loan amount at closing and the primary mortgage lender will be reimbursed after closing.
DPA loan amount: UP TO $7,500.00 for a non-subsidized property; UP TO $3,000.00 for a HOME subsidized property (the loan amount will be determined at completion of NSC underwriting process). DPA is a 0% interest, no monthly payments, five (5) year term loan. Owner must live in the property as their primary residence.
NSC does not subordinate DPA loans. If an owner refinances, sells or no longer resides in the property before the end of the loan term, they will be required to repay a pro-rated portion of the DPA loan. Each year, on the loan anniversary date, 20% of the original DPA loan amount is forgiven. After five (5) years, the loan is completely forgiven. The owner will be provided with a discharge of mortgage to be recorded at the registry of deeds.
How Do I Qualify?
1. Primary Mortgage Financing: Applicant must obtain primary fixed interest rate mortgage financing from a lender. Massachusetts Housing Partnership ONE Mortgage Program, Mass. Housing Mass Advantage, VA and FHA loans are all approved mortgage products. Applicant should contact banks for pre-approvals and to obtain primary mortgage financing. (Primary mortgage lender must fund the DPA loan amount at closing; the lender will be reimbursed after the Malden Redevelopment Authority receives original executed NSC Promissory Note and copies of recorded NSC Mortgage and closing Settlement Statement.). Information about mortgage products, resources, buying a home, lenders and home buyer counseling can also be found on My Mass Mortgage and HUD Homeownership Assistance websites.
2. Home Buyer Counseling: Applicant is required to attend a FTHB counseling workshop. The NSC sponsors workshops by Medford Community Housing and Chelsea Restoration Corporation. For information on these and other workshops, check CHAPA's counseling workshop website.
3. Income Qualifications: Applicant's combined household income (gross income) must fall at or below the 80% MFI income limits set by the U.S. Department of Housing and Urban Development (HUD). Income from all household members 18 years of age or older must be included, however, in certain circumstances, full time students' income may be excluded.
HUD Income Limits 80% Median Family Income (MFI) (effective April 1, 2018):
1 person household: $56,800.00 2 person household: $64,900.00
3 person household: $73,000.00 4 person household: $81,100.00
5 person household: $87,600.00 6 person household: $94,100.00
7 person household: $100,600.00 8 person household: $107,100.00
4. Other Qualifications: The property purchased cannot exceed the following Purchase Price Limits (effective April 2018).
Existing or New Housing
- Revere, Chelsea, Winthrop (Suffolk County): 1 Unit - $432,000.00
- Malden, Medford, Melrose, Arlington, Everett (Middlesex County): 1 Unit - $390,000.00
Asset Limits: Applicant cannot have more than $75,000.00 in liquid assets. Liquid assets include stocks, bonds, CDs, as well as cash, savings and trust funds (retirement accounts are not included in asset limits).
Credit Score: Applicant must have a minimum credit score of 620 for a condominium, townhome or single-family property purchase. If there is more than one applicant, the average of the applicants' credit scores must be a minimum of 620.
Inspection: A housing quality standards inspection will be completed - at no cost to the applicant - to ensure the property meets state and federal housing codes.
Housing-to-Income Ratio ("HTI"): Applicant can have a maximum HTI of 35% for a condominium, townhome or single-family property purchase. The HTI is the ratio of the applicant's complete monthly mortgage payment consisting of principal, interest, taxes, insurance and condominium fee ("PITI") to the applicant's total monthly household income. (Primary mortgage lender will issue a truth in lending disclosure or similar documents which clearly show the PITI payment.)
Debt-to-Income Ratio ("DTI"): Applicant can have a maximum total DTI of 50% for a condominium, townhome or single-family property purchase. The total DTI includes other debt such as student loans and consumer debt in addition to housing debt.
Sufficient Cash Reserves (post-closing): Applicant must have sufficient cash reserves on hand, including the amount of down payment assistance offered, to pay two months of PITI.
How Do I Apply?
Applications should only be submitted when an Applicant has an executed Purchase and Sale Agreement for a condominium, townhome or single-family property. Complete the DPA Loan Application. Contact the NSC community representative (contact information below) to make arrangements to submit completed application and required documentation - by mail or hand delivery - no emails accepted. ALL documents listed below must be submitted with completed application unless it is noted that the document will be prepared by NSC and/or will be signed at closing.
- Signed Purchase and Sale Agreement
- Voluntary Sale Disclosure (to be signed by seller prior to signing Purchase and Sale Agreement)
- Right to Withdraw (to be signed by seller if Purchase and Sale Agreement has been signed)
- Evidence of permanent resident alien status or legal alien status, if applicable, for applicant, co-applicant and all other household members age 18 or older
- Authorization for Release of Information Form (a separate form must be completed by applicant, co-applicant and all other household members age 18 or older)
- Primary (fixed interest rate) mortgage financing Loan Application
- Primary (fixed interest rate) mortgage financing Commitment Letter from qualified lender
- Form 1008 Uniform Loan Transmittal Summary issued by applicant's primary mortgage lender
- Truth in Lending Disclosure or similar documents issued by applicant's primary mortgage lender (detailing PITI)
- Copy of complete credit report (or credit reports if more than one applicant)
- Certificate from FTHB counseling workshop (not more than two years old)
- If self-employed, copies of current year-to-date profit and loss statement and copies of 3 years federal tax returns (ALL schedules)
- Copies of 3 years most recent federal tax returns (ALL schedules) and 3 years W2s (ALL employers) for applicant, co-applicant and all other household members age 18 and older
- Copies of 3 months most recent statements for ALL accounts including stocks, bonds, CDs, cash, savings, trust funds for applicant, co-applicant and all other household members age 18 and older
- Copies of 3 months most recent statements for ALL 401Ks, IRAs, stocks, bonds, retirement/pension accounts for applicant, co-applicant and all other household members age 18 and older
- Copies of 3 months most recent paystubs (ALL employers) for applicant, co-applicant and all other household members age 18 and older
- Copy of current Social Security award letter(s), including disability income, if applicable, for applicant, co-applicant and all other household members age 18 and older
- Proof of "other" income sources including alimony, child support, welfare assistance, etc., for applicant, co-applicant and all other household members age 18 and older
- Divorce decree, if applicable
- Zero Income Affidavit (a separate affidavit must be completed by every household member age 18 and older who has no income)
- Liquid Asset Certification
- IRS Certification AND Form 4506-T
- Housing Quality Standards (HQS) Disclosure
- HOME Written Agreement (NSC will prepare - applicant to sign when DPA Commitment Letter is issued)
- Recapture Agreement (NSC will prepare - applicant to sign when DPA Commitment Letter is issued)
- NSC Promissory Note (to be signed at closing)
- NSC Mortgage (to be signed at closing)
Upon approval, applicant will receive and be required to sign:
- Commitment Letter for DPA loan.
- Recapture Agreement acknowledging that the DPA loan amount can be recaptured if the property is refinanced, sold or transferred within five (5) years.
- HOME Written Agreement evidencing that the household and property complies with all of HUD’s standards.
At closing, applicant must execute NSC Promissory Note and Mortgage for the DPA loan amount (closing attorney/settlement agent must record NSC Mortgage at the registry of deeds). These documents will be provided to closing attorney/settlement agent (NSC Promissory Note and Mortgage can also be found above).
Malden: Maureen Taylor 781-324-5720 x 5730, firstname.lastname@example.org
Medford: Ashley Williams 781-393-2480, email@example.com
Arlington: Julie Wayman 781-316-3094, firstname.lastname@example.org
Chelsea: Bethany Rosa 617-466-4180, email@example.com
Everett: Al Borgonzi 617-394-2313, firstname.lastname@example.org
Melrose: Erin Heacock Zwirko 781-979-4193, email@example.com
Revere: John Festa 781-286-8194, firstname.lastname@example.org
Winthrop: Joe Domelowicz 617-846-1077, email@example.com
Lender and Closing Attorney/Settlement Agent Information:
For lender reimbursement, closing attorney/settlement agent must submit the following to the Malden Redevelopment Authority:
Original NSC Promissory Note
Copy of Recorded NSC Mortgage
Copy of closing settlement statement (showing DPA loan amount)
By USPS to: Malden Redevelopment Authority, P.O. Box 278, Malden, MA 02148 ATTN: HOME Program Director
By UPS, FedEx or by hand to: Malden Redevelopment Authority, 17 Pleasant Street, Third Floor, Malden, MA 02148 ATTN: HOME Program Director
If the property being purchased is a HOME subsidized property subject to NSC affordable covenant ("Covenant"), the closing attorney/settlement agent will be provided with a Covenant for signing by buyers at closing and recording at the registry of deeds by the closing attorney/settlement agent. A copy of the recorded Covenant should be returned to the Malden Redevelopment Authority along with the DPA loan documents. Note: Recapture Agreement not necessary if the property is subject to an affordable covenant.