If your home is purchased with a Home$tart or NAHI grant, the home is subject to a five-year deed restriction requiring a pro-rata repayment of the grant if sold within the deed restriction term. You may have to repay if you refinance your home within five years. When refinancing you may request a subordination of the grant, if permitted by the new lender, this is a document allowing you to make the new mortgage and keep the grant on the home.
The grant is forgiven pro-rata based on the length of time you own the home. If you sell your home to another low or moderate-income home buyer or at a net loss the remaining pro-rata balance of the grant may be forgiven.
Your closing agent will contact the original FHLB Des Moines member who provided the grant to request a repayment or forgiveness review. However, if you live in the home for at least five years, you never have to repay the grant. It’s all yours!
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