FY25 NCPA Presentation 2Valley Community
Development
Northampton CPA
Mortgage Loan Subsidy Program
Sarah Sargent –Program Director
Donna Cabana –Homeownership Program Manager
Program Goal
Provide four $50,000 loans to assist low-
and-moderate income, first -time
homebuyers with down payments and
closing costs when buying in
Northampton.
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Program
Guidelines
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•Inspections of the property are required
•Liquid cash assets cannot exceed $75,000
•Buyers must obtain a conforming mortgage with a 30 -year
fixed interest rate that meets guidelines of Fannie Mae
•Household income using gross income may not exceed 100%
of the AMI
•Approved households must obtain a CHAPA certified First
Time Homebuyer workshop
•Participating households must attend a Post -purchase
workshop
•All properties must be free of chipping and pealing paint prior
to closing
•Lead paint inspection required for households with children
under the age of 6
The mortgage subsidy will be in the form of a 1% simple interest
mortgage and note at the time of the closing with a term of 30 years.
This is a deferred payment loan that is due upon sale, transfer of the
deed, with interest of $500 per year for years 1 -15. After year 16, 1/15
will be forgiven each year of the principle of $50,000. At the end of the
term, $7,500 in interest is due.
The funds are also due when a cash out refinance takes place that does
not improve the property.
Mortgage and Note
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Example
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Household Income 100% of AMI (family of 4)$ 97,000.00
Monthly Income $ 8,083.33
Monthly Loan Payment and Escrow $ 2,505.83
Purchase Affordability $ 300,000.00
Need 3% down $ 9,000.00
Expect 2-5% for closing costs $ 7,500.00
Questions
Sarah Sargent, Program Director
ss@valleycdc.org
Donna Cabana, Homeownership Program Manager
dc@valleycdc.org
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