Rural Homes 42 Cleveland Street

Eligibility

Application: Applications must be complete and received on time to be considered for the lottery. 

First-Time Homebuyer: To be eligible, applicants must qualify as first-time homebuyers. First-time homebuyers are defined as a household that has not owned a home within three years preceding the application, with the following exceptions:

a)   displaced homemakers, where the displaced homemaker (an adult who has not worked full-time, full-year in the labor force for a number of years but has, during such years, worked primarily without remuneration to care for the home and family), while a homemaker, owned a home with his or her partner or resided in a home owned by the partner;

b)   single parents, where the individual owned a home with his or her partner or resided in a home owned by the partner and is a single parent (is unmarried or legally separated from a spouse and either has 1 or more children of whom the individual has custody or joint custody, or is pregnant);

c)   households where at least one household member is 55 or over;

d)   households that owned a principal residence not permanently affixed to a permanent foundation in accordance with applicable regulations; and

e)   households that owned a property that was not in compliance with State, local or model building codes and that cannot be brought into compliance for less than the cost of constructing a permanent structure.

Households must receive homeownership education/counseling prior to closing on the purchase of the home. A certificate of completion from a HUD-approved homebuyer education course, dated within two (2) years of closing, will be required as documentation. 

Income Limits: To be income eligible, an applicant’s anticipated annual gross income for all current adult household members for the 12-month period following application must be at or below 80% of the Area Median Income (AMI) for Franklin County, as determined by the U.S. Department of Housing and Urban Development (HUD), shown below.

Number of People in Household - Max. Allowable Household Income

1 - $61,350

2 - $70,100

3 - $78,850

4 - $87,600

5 - $94,650

6 - $101,650

Asset Limits: The asset limit is $75,000 per household. Household assets divested for less than full and fair cash value within the past 2 years will be counted at the full and fair cash value for purposes of calculating eligibility.

Household Assets include:

• Cash in savings accounts, checking accounts and safety deposit boxes, etc.
• Certificates of deposit, bonds, stocks, treasury bills, mutual funds and money market accounts.
• Revocable trusts.
• Equity in rental property or other capital accounts.
• Cash value of life insurance policies available to the applicant before death.
• Personal property held as an investment: Gems, jewelry, coin collections, or antique cars, etc. Personal jewelry is NOT considered an asset.
• Lump sum receipts or one-time receipts. i.e. inheritance, capital gains, one-time lottery winnings, victim’s restitution, settlements on insurance claims (including health and accident insurance, worker’s compensation, and personal or property losses), and any other amounts that are not intended as periodic payments.
• A mortgage or deed of trust held by an applicant.
• IRA, 401(k), 403B. *
• Retirement and pension funds. (if employed) *

*These will include only amounts the applicant can withdraw without retiring or terminating employment, minus any penalties or transaction fees. (Applicant will be responsible for determining and verifying how much of these funds are available as cash.)

Household Assets DO NOT include:

• Personal property. (i.e. clothing, furniture, cars, wedding ring and other jewelry that is not held as an investment, vehicles specially equipped for persons with disabilities)
• Term life insurance policies. (i.e. policies with no cash value)•Equity in the cooperative unit in which the applicant lives.
• Assets that are part of an active business. Business DOES NOT include rental of properties that are held as investments unless such properties are the applicant’s main source of income.
• Assets that are not effectively owned by the applicant.

Mortgage Pre-Approval: A mortgage pre-approval letter is required to be entered into the lottery. The pre-approval letter must be based on the applicant’s credit score and current financial situation and be from a lender experienced with first time homebuyers and deed restricted properties.

Applicant financing must meet the following criteria:

a)   Down payment must be at least 3% of the purchase price, at least $1,000 of which must come from the buyer’s funds. 

b)   Mortgage loan must be a 30-year fully amortizing mortgage for not more than 97% of the purchase price with a fixed interest rate that is not more than 2 percentage points above the current Freddie Mac interest rate (www.freddiemac.com).

c)   Monthly housing costs (inclusive of principal, interest, property taxes, hazard insurance, private mortgage insurance and condominium or homeowner association fees) shall not exceed 38% of monthly household income. 

d)   Non-household members are not permitted as co-signers of the mortgage.

Household Size: To be eligible, the household size cannot exceed State Sanitary Code requirements for occupancy of the unit.

Households that need the total number of bedrooms have preference, i.e. a household requiring three bedrooms would have preference over a smaller household for a three-bedroom home. The following criteria are considered to determine household size preference:

• At least one occupant per bedroom
• Married or unmarried couples must share a bedroom unless there is a medical necessity for someone to have a separate bedroom. Medical documentation is required that supports the need for separate bedrooms. 
• An unborn child may be counted as a household member if proof of pregnancy is submitted with the application.
• Foster children are not included in the total household composition in accordance with HUD regulations (24 CFR 5.609 HUD regulations).
• If the applicant is in the process of a divorce or separation, the applicant must provide proof that the divorce or separation has begun or has been finalized.