HomeMy WebLinkAboutExhibit 12X. American Dream Downpayment
Initiative (ADDI)
The American Dream Downpayment Initiative (ADDI) was signed into law by President Bush on
December 16, 2003 under the American Dream Downpayment Act (Public Law 108-186) (ADDI statute).
Funds made available under the ADDI statute will be allocated to eligible HOME program Participating
Jurisdictions (PJ) to assist low-income families become first-time home ers. Each local participating
jurisdiction receives ADDI funds from the state's share, proportiona • • ercentage of the statewide
total of low-income renter households within the participating jurLion, as determined by the most
recent available U.S. census data.
The ADDI regulations can be found at 24 CFR Part 92.6
ADDI Funds and HOME
ADDI will be administered as part of the HOME hive
local participating jurisdictions. ADDI funds may only b
purchase of single family housing by -income families
that is completed in conjunction with a purchase assiste
under the ADDI statute. A participating's total rehabs
of its annual ADDI allocation.
Generally, requirement
nuances in the ADD
the following fe
• Federal an
• En ' onmenta
eme 2.354
require
In addi
more than
maximum
Lead -
Conflict o
Consultant ac
OME funds
00 is req
subs'
(§ 5);
st(§'
OME rule).
e ips Program TOME) by state and
for downpayment assistance towards the
e first-time homebuyers. Rehabilitation
DDI funds is also an eligible activity
assistance may not exceed 20%
OME homebu ects ap• • ADDI projects. However, there are some
make the req + ements diff slightly from HOME requirements. As such,
under subpa of the HOME rule apply to ADDI funds:
on requireme . (§ 92.350);
)•
be used in conjunction with ADDI funds, especially when an investment of
d. However, the total HOME and ADDI investment cannot exceed the
limits for the jurisdiction.
Local Use of ADDI Funds and Outreach
As an extension of the HOME funds and in line with the HOME housing objectives described in previous
chapters, the City of Miami will use ADDI funds to provide down payment assistance to first time
homebuyers for the purchase of a home. The funds will not be used for rehabilitation at this time.
To assure that all residents have access to ADDI, the City will conduct various outreach activities. This will include
advertising the program on local media outlets in English, Spanish, and Creole. Information will also be distributed
among Home Counseling and Homebuyer program providers, mortgage lenders, realtors, CBOs, public housing
providers and other organizations that serve individuals who may be eligible for assistance.
Finally, the City of Miami will assure the suitability of the ADDI program. ADDI and HOME regulations
will be implemented to meet local needs. In the 30 Program Year, ADDI assistance will be provided in
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combination with the HOME First Time Homebuyer Assistance Program for total downpayment assistance
of 50 housing units. The number of units funded by ADDI will be 44. It is important to note that funding
available from ADDI will include funds from 2003 and 2004, for a total of $444,833.
Funding
Source
ADDI
City of Miatni Programs
Annual
Performance
Measures
Homebuyer Assistance
■ American Dream Down Payment Program*
19 housing units
Source: ADDI assistance will be provided in combination with the HOME First me Homebuyer Assistance Program
for total of 50 housing units. The number of units funded by ADDI will be 44
ADDI Eligibility Requirements.
As mentioned earlier, the ADDI program will be use' com. nation with
following are essential eligibility requirements of ADDI program.
1.
Homebuyer Eligibility:
i) Under ADDI, a first-time homebuyer is an in
owned a home during the thr
ADDI. The term first-time ho
definition used for ADDI is loc
Act (Public Law 101-625, appro
ii) The home
principal re
iii) C.
Mortgage
household inc
Maximu
greater of $1
' able Housin
, condomi
ed as a
are
ar period prior to
includes displa
of Cranston
1990)
located withi
ghout the a
ty of
dability per
d;
and SHIP. The
and his or her spouse who have not
e of a home with assistance under
m ' akers and single parents. The
lez National Affordable Housing
AHA)
nd occupied by the homebuyer as a
and
1) homebuyer . d ) homebuyer's superior mortgage lender(s) [bank,
non-profit ag. 1 for the highest level possible, not to exceed 30% of
that the first mortgage lender will approve.
nce: ADDI funds are subject to a maximum of the
e purchase price.
ypes: Eligible properties are limited to single family homes, town
m units, and co-operative units. Under ADDI, single family homes
e- to four -family residence, condominium unit, or co-operative unit.
4. Homeb s Down Payment Equity: Minimum down payment of $500.
5. Subordinated Mortgage Financing: Principal and interest payments plus escrow
payments on the combined mortgages shall not exceed 30% of the household total gross
monthly income. If first mortgage holder is willing to make a loan under higher ratios,
assistance can still be provided depending on the risk profile of the entire loan.
6. Recapture Provision: In the event that the unit is resold, leased or rented during the
affordability period, the homebuyer must repay the financial assistance associated with
the unit, in full. Refinancing of an assisted unit during the affordability period requires
prior approval by the City Manager or designee, who will at that time determine whether
the assistance must be repaid in full.
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7. Maximum Purchase Price/Appraised Value: The purchase price or appraised value of
an assisted unit may not exceed the maximum HOME value allowed by HUD as
published by the Federal Housing Authority (FHA) 203(b) mortgage limit for the type of
housing being purchased.
8. Period of Affordability: The affordability period on an assisted unit will be twenty (20)
years from the date of purchase by an eligible homebuyer.
9. Form: Funding will be provided to the homebuyer in the form of a deferred, non -
amortizing, non interest -bearing loan which will come payable, in full, in the event of
sale, lease or rental of the assisted property during the affordability period. If the
homebuyer elects to refinance, the City's approval will be req
Monitoring.
According to regulations, HUD will credit ADDI wit
completed during the grant period until the particip
the participating jurisdiction's ADD1 funds are
subsequent downpayment assistance activities.
Accomplishments, and Commitment and Disbursemen
Furthermore, HUD will extract data
enter beneficiary information into IDI
additional information participating juri
whether the beneficiary of a homebuyer
As)
2006-2007 Action Plan
ime homebu .wnpayment assistance
g jurisdiction's ADDI '1 're depleted. Once all
d, HUD 11 credit regular nds for any
run a thly report trac • _ ADDI
IDIS to compile n • reports. Participating jurisdictions will
if ADDI funds gular HOME funds. The only
be required into IDIS is an indication of
ime hom yer.
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