Reinstatement of Repayment Requirement - Effective January 1, 2020
posted on Wednesday, December 18, 2019 in Business News
Competitive Affordable Housing Program (AHP) and Down Payment Product grants for owner-occupied units are subject to a 5-year retention period, requiring a lien through an FHLB Des Moines approved Retention Agreement (Deed Restriction, and formerly a Deed of Trust).
In March 2018, FHLB Des Moines temporarily suspended the requirement for repayment of AHP/Down Payment Program subsidy awards in connection with the sale or refinance of an owner-occupied unit during the term of the homeownership Retention Agreement.
Effective January 1, 2020, the Repayment Requirement will be reinstated.
FHLB Des Moines has established new procedures and updated forms for lien releases, repayment or subordination of liens.
Please begin using these procedures and forms in the event of the sale or refinance of owner-occupied residences assisted with an AHP/Down Payment Program grant.
New procedures and forms are provided for:
View All Forms And Procedures
*Forgiveness of repayment: If a borrower sells their home to a low-to-moderate income household, their subsidy does not need to be repaid and the lien may be released. Additionally, subsidy repayment is terminated after any event of foreclosure, transfer by deed in lieu of foreclosure, an assignment of a Federal Housing Administration first mortgage to HUD, or death of the AHP/Down Payment Program assisted homebuyer.
Who is impacted by this change?
You will be impacted by this change if you are a contact for one or more of the following:
- An active AHP homeownership project
- A completed AHP homeownership project still in retention
- An enrolled FHLB Des Moines member institution in Home$tart or NAHI, or;
- A member institution who had awards in Down Payment Programs of FHLB Des Moines or FHLB Seattle from January 1, 2014 - December 31, 2015.
- Affordable Housing Program
- Community Investment