MSHFA Webinar

MI FirstSingle
Underwriting
Webinar
Family
Underwriting/Origination Webinar
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MSHDA Lender Letter
Contact Kathy Quigley at
quigleyk@michigan.gov
Lender on Line Access
Contact Sarah Bohne at
bohnes@michigan.gov
Benefits of a MI First Loan
• Competitive interest rates
• Down Payment Assistance (DPA) is available
• Several products available - FHA, VA, RD and
Conventional
• Helps low - moderate income customers become
homeowners
• CRA rating
Current Interest Rates
• Without DPA = % - No Points
• With MSHDA’s DPA = % - No Points
Interest rates posted on our Web Site
http://www.michigan.gov/mshda or
https://mshdalenderaccess.cgi-bps.com
Loan Reservations
• Good for 90 days = Interest Rate Lock
• Reservations made on Lender On Line Web site
• Reserved for the buyer – stays with buyer, not
necessarily the property
Signed
Purchase
Agreement
Funds Sent to
Lender
Make a
Reservation to
lock in the % rate
Lender sends
package to MSHDA
for purchase
Package the
loan
Lender closes
and funds the
loan
Underwritten &
Approved by
Lender
Send loan
package
to MSHDA
MSHDA reviews
& Commitment is
sent
Process
Flow
Compliance Requirements
•
•
•
•
Prior Homeownership
Sales Price Limits
Income Limits
Asset Limit—DPA loans only
All Adults in Household Must Apply
• All adults living in the household or who intend to occupy
the house must apply jointly and be credit qualified
• Adult children must apply (unless full-time student, must supply
transcript)
• Separated Spouses - must have final Divorce Decree or
Judgment for Separate Maintenance
Prior Homeownership
•
•
•
•
Targeted versus Non-targeted
3 year restriction in non-targeted areas
Legal description of property
3 year in-file history on credit report with no mortgages
showing
– Or 3 years signed federal tax returns
– Or Income Tax Affidavit if not required to file
LIST OF TARGETED AREAS
Exempt Counties: No Restriction on Prior Home Ownership in the Entire County
County
Alcona
Cass
Charlevoix
Cheboygan
Chippewa
Clare
Crawford
Delta
Dickinson
Emmet
Gladwin
Gogebic
Alger
Allegan
Alpena
Antrim
Arenac
Baraga
Barry
Benzie
Berrien
Branch
Grand Traverse
Gratiot
Hillsdale
Houghton
Huron
Ingham
Ionia
Iosco
Iron
Isabella
Kalamazoo
Kalkaska
Keweenaw
Lake
Lapeer
Leelanau
Lenawee
Luce
Mackinac
Manistee
Marquette
Mason
Mecosta
Menominee
Missaukee
Montcalm
Montmorency
Newaygo
Oceana
Ogemaw
Ontonagon
Osceola
Oscoda
Otsego
Presque Isle
Roscommon
St. Clair
St. Joseph
Sanilac
Schoolcraft
Tuscola
Van Buren
Washtenaw
Wexford
No Restriction on Prior Home Ownership in these Exempt Cities and
Townships in Non-exempt Counties
Township exemption includes only unincorporated areas within the township.
Parent County
Cities and
Townships
Parent County
Cities and
Townships
Bay
Bay City
Gibson Twp.
Mt. Forest Twp.
Pinconning Twp.
Midland
Calhoun
Albion
Battle Creek
Burlington
Lee Twp.
Coleman
Geneva Twp.
Greendale Twp.
Jasper Twp.
Lee Twp.
Midland
Mills Twp.
Mt. Haley Twp.
Clinton
East Lansing
Maple Rapids
Lebanon Twp.
Ovid Twp.
Monroe
Luna Pier
Frenchtown Twp.
Muskegon
Muskegon
Muskegon Heights
Eaton
Genesee
Charlotte
Olivet
Vermontville
Brookfield Twp.
Roxand Twp.
Oakland
Pontiac
Royal Oak Twp.
Southfield
Ottawa
Genesee Twp.
Flint
Mount Morris Twp.
Holland
Chester Twp.
Allendale
Saginaw
Merrill
Saginaw
Brady Twp.
Brant Twp.
Bridgeport Twp.
Chapin Twp.
Marion Twp.
Shiawassee
Laingsburg
Owosso
Fairfield Twp.
Hazelton Twp.
Middlebury Twp.
Wayne
Dearborn
Detroit
Ecorse
Hamtramck
Highland Park
Inkster
Lincoln Park
River Rouge
Taylor
Wayne
Jackson
Jackson
Pulaski Twp.
Kent
Grand Rapids
Kent City
Kentwood
Spencer Twp.
Wyoming
Livingston
Macomb
Howell
Cohoctah Twp
Conway Twp.
Iosco Twp.
Harrison Twp.
Mt. Clemens
NOTE: If a home is located in an area that is not named on one of the above lists, that means the property is located in a Non-targeted Area. In Non-targeted Areas, a
person is not eligible for the Single Family or MCC program if they have owned a home as their principal residence within the last three years.
03/14
Michigan State Housing Development Authority
Homeownership
735 E. Michigan Avenue
Lansing, MI 48912
INCOME TAX AFFIDAVIT
(FORM EXECUTED BY APPLICANTS THAT DO NOT FILE TAX RETURNS)
I(We) the undersigned, being first duly sworn state the following:
I(We) hereby certify that I(we) was(were) not required by law to file a federal income tax return for the
following year(s)
for the reason(s) stated below:
In the event that I(we) receive a mortgage loan, I(we) hereby acknowledge that any false pretense, false
statement, misrepresentation or material misstatement made by me(us) creates a legal and binding obligation for
me(us) to make full repayment of the mortgage loan, and the lender can foreclose the mortgage to enforce the
obligation. In addition, I(we) acknowledge that if any person, with an intent to defraud or cheat, designedly by
false pretense, including any false statement or misrepresentation, obtains money, real or personal property, or
the use of any instrument, facility, article or other valuable thing or service pursuant to my(our) participation in any
Michigan State Housing Development Authority program, shall be guilty of a crime. Such person may be guilty of
either a misdemeanor or a felony, punishable by imprisonment for not more than ten (10) years or a fine or both,
all as set forth in Section 47 of Act No. 346 of the Public Acts of 1966, as amended (MCL 125.1447).
Date
Signature
Signature
STATE OF MICHIGAN
COUNTY OF
)
)
The foregoing instrument was subscribed and sworn before me on this
day of
by
Notary Public, State of Michigan,
County of
My Commission Expires:
SFH 108 (7-2014)
Income Tax Affidavit
,
Sales Price and Income Limits
Income Limits from $60,400 to $122,360
Sales Price Limit
$224,500
Limits are the same for DPA
Michigan State Housing Development Authority
Single Family Purchase Program and Mortgage Credit Certificate Program (Exhibit B)
Income and Sales Price Limits
TARGETED Areas (listed below)
Income1-2
Persons
$76,920
Income 3 or
More
Persons
$89,740
Sales Price
$224,500
$77,040
$89,880
$224,500
$77,040
$89,880
$224,500
$78,600
$77,040
$91,700
$89,880
$224,500
$224,500
$75,360
$87,920
$224,500
$77,520
$81,000
$95,160
$77,520
$90,440
$94,500
$111,020
$90,440
$224,500
$224,500
$224,500
$224,500
$79,320
$92,540
$224,500
$76,560
$77,520
$82,320
$77,520
$104,880
$89,320
$90,440
$96,040
$90,440
$122,360
$224,500
$224,500
$224,500
$224,500
$224,500
$77,520
$90,440
$224,500
$72,480
$84,560
$224,500
City/Township
Areas Not Listed As Targeted Above
Areas Not Listed As Targeted Above
Income 1-2
Persons
$64,200
$79,300
Income 3 or
More
Persons
$73,830
$91,195
Sales Price
$224,500
$224,500
Areas Not Listed As Targeted Above
$64,600
$74,290
$224,500
Areas Not Listed As Targeted Above
Areas Not Listed As Targeted Above
Areas Not Listed As Targeted Above
$66,100
$63,800
$68,600
$76,015
$73,370
$78,890
$224,500
$224,500
$224,500
$60,400
$69,460
$224,500
County
Barry
City/Township
Entire County
Clinton
East Lansing, Lebanon Twp., Maple Rapids, Ovid Twp.
Eaton
Emmet
Ingham
Kent
Lapeer
Leelanau
Livingston
Macomb
Midland
Monroe
Oakland
Ottawa
St. Clair
Washtenaw
Wayne
Brookfield Twp., Charlotte, Olivet, Roxand Twp.,
Vermontville
Entire County
Entire County
Grand Rapids, Kent City, Kentwood, Spencer Twp.,
Wyoming
Entire County
Entire County
Cohoctah Twp., Conway Twp., Howell, Iosco Twp.
Harrison Twp., Mt. Clemens
Coleman, Geneva Twp., Greendale Twp., Jasper Twp.,
Lee Twp., Midland, Mills Twp., Mt. Haley Twp.
Frenchtown Twp., Luna Pier
Pontiac, Royal Oak Twp., Southfield
Allendale, Chester Twp., Holland
Entire County
Entire County
Dearborn, Detroit, Ecorse, Hamtramck, Highland Park,
Inkster, Lincoln Park, River Rouge, Taylor, Wayne
All Other TARGETED Areas (not listed above)
NON-TARGETED Areas (listed below)
County
Clinton, Eaton
Livingston
Macomb,
Oakland, Wayne
Midland
Monroe
Ottawa
All Other NON-TARGETED Areas (not listed above)
Revised 03/01/2014
Computing Income
•
•
•
•
Gross Household Income
Current Income Projected Forward 12 Months
Income Limits versus Qualifying Income
Required Documentation
– VOE or
– VVOE, paystub showing at least 30 days of YTD earnings and
must be dated no earlier than 30 days from date of submission &
2 years W2’s
• Child Support
– FOC
MI First Loan Programs
• FHA
– DPA available
• VA
• Conventional
– Max LTV 80%
• Rural Development
– DPA available
Underwriting Guidelines
• MSHDA will not automatically approve loans based
solely on decisions obtained from Agency Systems or
lender’s underwriter approval.
• Ratios - must follow ratio guidelines. MAX DTI 45%
Ratio Requirements
Must follow standard guidelines
Conv 41%
FHA 43%
VA 41%
RD 41%
Exceptions to standard guidelines require documented
compensating factors that are satisfactory to MSHDA U/W staff.
At no time can the DTI ratio exceed 45%
FHA
• 96.5% LTV
• DPA Available
• Transmittal Signed by DE Underwriter
• Follow FHA Guidelines
• Ratios 43%
VA
• Maximum LTV 100%
• Loan Analysis required
• VA underwriting guidelines
• Ratios 41%
Rural Development
• RD underwriting guidelines
• RD Commitment required
• Ratios 41%
• DPA available for prepaids, closing costs and
guarantee fee
Conventional
• Max LTV 80%
• DPA no longer available
• Ratios of 41%
• 1008 signed by lender’s underwriter
Down Payment Assistance
•
•
•
•
•
•
0% interest, non-amortizing, soft second mortgage
Appraised value must support sales price
$7,500 maximum
Available with FHA and RD Loans
1% cash investment required from borrower
$7,500 cash asset restriction—all accounts must be
documented
• DPA Worksheet (FHA Example)
• Homebuyer Ed Lender Referral form
EXHIBIT GG
MSHDA/FHA DOWN PAYMENT ASSISTANCE
CALCULATION WORKSHEET
Asset limit is $7500
A.
Sales Price:
$_____________________
B.
Mortgage Amount
$________________________
(1.A. Multiplied by 96.5%)
C.
Down Payment:
$________________________
(1.A Minus 1.B)
D.
Closing Costs
$________________________
E.
Prepaid/Escrows
$________________________
F.
SubTotal:
$________________________
(1.C + 1.D + 1.E)
G.
1% of Sales Price
$_____________________
(1.A. Multiplied by 1%)
H.
Seller concessions
$_____________________
I.
Maximum Down Payment Assistance:
$_____________________***
(1.F Minus 1.G & 1.H)
***Cannot Exceed $7,500
Lender Signature
FHA SF-DPA - Effective 06/12
Date
Lender Referral
For Homebuyer Education and/or
Pre-Purchase Home Inspection Funds
Homebuyer Education
Pre-Purchase Home Inspection Funds
Borrowers Authorization:
I authorize ________________________________________ (name of lending institution) to
provide a copy of our Good Faith Estimate, Truth in Lending Statement and Purchase Agreement
to a MSHDA contracted counseling agency.
Borrowers Name: ________________________________________________________
Address: __________________________________________ Phone: _______________
Borrowers Signature: ________________________________ Date: ________________
Co-borrowers Name: ______________________________________________________
Co-borrowers Signature: _____________________________ Date: _________________
To be completed by Lender:
The above Borrower(s) have applied for a MSHDA mortgage and meet the income and credit
requirements for a MSHDA loan. If Pre-Purchase Home Inspection Funds are being requested,
the Purchase Agreement includes a requirement for home inspection(s).
Lending Institution: ________________________________________________________
MSHDA Loan Reservation Number: __________________________________________
MSHDA Mortgage Loan Type (circle one):
FHA
VA
MSHDA Down Payment Assistance Loan (circle one):
USDA RD
YES
CONV
NO
Loan Originators Name: _______________________________________________________
Loan Originators Signature: ___________________________________ Date: ____________
To the Counselor:
The person(s) named above has applied for a MSHDA mortgage loan and are being referred to
your agency for Lender Referred Homebuyer Education and the resulting Certificate of
Completion and/or Pre-Purchase Home Inspection Funds.
Note: Homebuyer Education is only required if the Borrower(s) is applying for a MSHDA
first mortgage and a MSHDA Down Payment Assistance loan. Receipt of Pre-Purchase
Home Inspection Funds is not contingent upon the borrowers attending homebuyer
education.
Revised 6/2013
Michigan State Housing Development Authority
Assets
• VOD or bank statements that cover 30 consecutive days
and be dated within 45 days of the date of loan
submission
• Gift Letters-document availability of funds and transfer
• Subordinate lien docs require prior MSHDA approval
Credit Requirements
• Credit Score Requirements(all adults)
• 640
• 660 if a manufactured home
• No scores due to a lack of credit only, will be evaluated case by case
following the minimum number of non-traditional credit sources required by
loan type
• MSHDA requires all collections and judgments to be paid
• Satisfactory Letter of Explanation for derogatory credit
Eligible Property Types
• New homes
• Existing homes
• New/existing (post 6-14-76) multiple-section
manufactured homes, taxed as real estate and
permanently affixed to the land
Eligible Property Types
Condominiums
• FHA - lender responsible for making sure condo is
insurable on both new and existing
• Conventional - Condo Warranty Certificate signed by
underwriter
New, Never Occupied Homes
• End Financing
• Must Be Completed Prior to Loan Purchase
• Copy of Current Builders License
(maintained in your file)
• Equal Opportunity Builder Cert.
Michigan State Housing Development Authority
Homeownership
735 E. Michigan Avenue
Lansing, MI 48912
EQUAL OPPORTUNITY BUILDER CERTIFICATE
I hereby certify that I will comply with all equal housing opportunity requirements of the Michigan State Housing
Development Authority (MSHDA) during my participation in its Homeownership Program.
These requirements are:
1. Equal employment - The hiring of employees or the contracting of all work related to any construction
performed during my participation in the MSHDA Homeownership Program will be open to all persons,
regardless of race, color, creed, national origin or ancestry, sex, or marital status.
2. Equal housing opportunity - All houses for which I am the principal contractor during my participation in
the MSHDA Homeownership Program will be offered for sale and sold on a basis that is open to all persons,
regardless of race, color, creed, national origin or ancestry, sex, or marital status.
3. Advertising - Consistent with the above provisions of equal housing opportunity, I will advertise equal
housing opportunity in all my advertising during my participation in the MSHDA Homeownership Program.
This includes the use of the equal housing opportunity logo with the words “equal housing opportunity” in
proximity to the logo in all display advertising, and the words “equal housing opportunity” to be used in all
column, radio, or television advertising.
The undersigned acknowledges that if any person, with an intent to defraud or cheat, designedly by false
pretense, including any false statement or misrepresentation, obtains money, real or personal property, or the use of
any instrument, facility, article or other valuable thing or service pursuant to his/her participation in any Michigan
State Housing Development Authority program, shall be guilty of a crime. Such person may be guilty of either a
misdemeanor or a felony, punishable by imprisonment for not more than ten (10) years or a fine or both, all as set
forth in Section 47 of Act No. 346 of the Public Acts of 1966, as amended (MCL 125. 1447).
Date
Company Name ____________________________________________
As it appears on actual license
By ____________________________________________
Signature
Title ____________________________________________
SFH 110 (07/09)
Equal Opportunity Builder Cert.
Property Requirements
• Full Appraisal with utilities on
• Private Roads/Joint Driveways
(permanent easement)
• Personal Property
• Repairs – may not be financed
Maximum Acreage
• May only finance 2 acres
• Exceptions may be granted on a case-by-case
basis up to a 5 acre maximum. (See Section 13.6
of Operating Manual
• Acreage Waiver
MICHIGAN STATE HOUSING DEVELOPMENT AUTHORITY
REQUEST FOR WAIVER OF THE ACREAGE LIMITATION
Lender:_________________________________________________________________
Contact Person:__________________________________________________________
Phone Number: (
)________________ Fax Number: (
)__________________
Borrower Name__________________________________________________________
MSHDA Loan Reservation Number:________________________________________
Size of land to be financed:________________________________________________
Land may be financed only to the extent it is necessary to maintain the basic
livability of the residence. The maximum acreage for loans financed with New Bond
Funds is 2 acres.
To request a waiver of the above acreage limitation the following items are needed:
1.
Photographs of the property
2.
Appraisal
a. Must indicate parcel size is common and customary for area
b. Must indicate no income production from land
c. Must indicate land value does not exceed 30% of total value
d. Must include comparable land data to support exception
3.
Statement from appraiser or local authority declaring likelihood of
property being subdivided.
4.
Statement from appraiser or local authority stating any recorded land
use, restrictive covenants or zoning and regulations that describe the
acreage requirements if any exist.
MSHDA Approval/Rejection
Request has been approved.
Request has been rejected due to: _______________________________
________________________________________________________________
______________________________________ _________________________
MSHDA Representative
Date
DOH – 003 (5-1-07)
Acreage Waiver
Maximum Lot Size
• Proceeds of a MSHDA loan cannot be used to purchase
land large enough to legally construct more than one
house, or land that consists of two or more separate
buildable lots.
• Additional documentation such as a survey and a letter
from the local municipality may be required to determine
compliance.
Miscellaneous
• MSHDA documents must be originals
• Co-signers/Non-Occupying Co-borrowers – Not Allowed
• Separated Spouses must have a Judgment for Separate
Maintenance
• Escrow accounts are always required
Commitments
Valid for:
• 90 days for an existing home
• 180 days for new construction
• If loan amount changes + or - $500, call MSHDA for
amended Commitment
• Sample of a Commitment
• Remember – do not close without your Loan
Commitment
MICHIGAN STATE HOUSING DEVELOPMENT AUTHORITY
SINGLE FAMILY PROGRAM COMMITMENT FOR MORTGAGE PURCHASE
SF Loan #:
LT#
Bond Series: (#048) 2009 E,F
Borrower:
CoBorrower:
Address:
City/Zip:
County:
WAYNE
Loan Amount:
Monthly P&I:
Interest Rate: 5.7500%
Terms/Loan Type:
360 FHA-MSHDA DPA
Date Received: 11/23/09
Expires On: 02/22/10.
The Michigan State Housing Development Authority (MSHDA) hereby commits itself to purchase the
above described first mortgage and the note secured thereby, subject to and in accordance with the
Lender Agreement entered into between MSHDA and the Lender, and the provisions of the MSHDA
Operating Manual in effect as of the date of this Commitment, all of which are fully incorporated herein by
reference. Any changes in approved loan amount of more than $500 up or down require loan to be
re-reviewed by MSHDA
SPECIAL CONDITIONS REQUIRED BY MSHDA ON OR BEFORE CLOSING
00
Down Payment Assistance approved at $ . (MUST BE ROUNDED TO THE NEAREST DOLLAR) based on the
calculations on the attached worksheet. Any increase of 10% or more requires MSHDA approval prior to
closing. At no time may the maximum DPA exceed $7500. Borrower’s cash investment to be a
minimum of one percent (1%) of the sales price.
No cash back at closing
No other liens are authorized plus First Right of Refusal Agreements must receive prior approval by
MSHDA and be subordinated to MSHDA Mortgage.
Subject to payment of the delinquent credit on or before closing:
Account #s:
Manufactured Home – (1) Copy of Certificate of Title showing MSHDA as first secured party AND
Affidavit of Intent and Agreement as to Classification SFH 115 (7/03) OR (2) Manufactured Housing Unit
– ALTA 7 Form 3512 (must be forwarded with final documents) OR (3) Recorded Copy of Affidavit of
Affixture.
Survey – Required for New construction or if Title Company/Closing Agent requires. All other
transactions must contain an Alta 9 endorsement on Title Policy.
Subject to evidence of completion of repairs/house.
nd
Subject to completion of ADR-DPA 2 Mortgage (SFH 022) and ADR-DPA 2
and borrower’s cash investment of at least 1%.
nd
Mortgage Note (SFH 021)
Subject to subordinate liens of:
Seller Contribution in the amount of:
$_ ____%
Document transfer of gift funds from donor to borrower in the amount of
$____________.
Other:
By:________________________________________________
Katy Twining Manager of Homeownership Operations
Michigan State Housing Development Authority
Equal
Housing
Lender
01/08
735 EAST MICHIGAN AVENUE  P.O. BOX 30044  LANSING, MICHIGAN 48909
www.michigan.gov/mshda  (517) 373-6840  (517) 335-7081 FAX
Allowable Closing Costs and Fees
• Current chart available in Closing Docs on Lender on
Line
• Chart
MSHDA Borrower Costs and Other Fees
This list is not all-inclusive.
Any fees listed as allowed for actual cost are subject to verification upon request.
Additional fees/charges are assessed on a case-by-case basis.
DESCRIPTION OF FEES
ELIGIBLE
AUS Fee (Automated Underwriting)
Closing Fee
Commission
Actual Cost
Actual Cost
Not Allowed
Commitment Fee to Non-Profit
Courier Fees
Credit Report Fees
Documentation Preparation
Document Stamp on Deed
Flood Certification
Home Inspection Fee
Lock-in Fee (Application/Commitment Fee)
Notary Fee
Actual Cost
Actual Cost
Actual Cost
Allowed
Actual Cost
Actual Cost
Actual Cost
Not Allowed
Actual Cost
Origination Fee
Pest Inspection
Allowed
Actual Cost
Printing/E-mail Fee
Processing Fee - Lender
Actual Cost
Not Allowed
Real Estate Fees
Recording Fee
Re-key Fee
Servicing Fee
Short Sale Fee
Survey
Tax Certificate
Tax Certificate/Service Fee
Title Policy/Lender
Title Policy/Owner
Transfer Tax
Underwriting Fee
Verifications/Condo Questionnaire
Well & Septic
Wire Fee
Allowed
Allowed
Allowed
Not Allowed
Actual Cost
Actual Cost
Not Allowed
Not Allowed
Actual Cost
Actual Cost
Actual Cost
Allowed
Actual Cost
Actual Cost
Actual Cost
EXPLANATION
3rd party AUS system
Real estate commission
Any commitment fee, application fee, or processing fee charged by a non-profit agency or
government entitiy is allowed to be charged to the buyer; includes MCC fee
Maximum $75
Maximum $400 or the actual cost
Up to 1% of base mortgage amount (if HUD Line 801 exceeds 1%, additional origination
charges MUST be itemized)
Maximum $50 (i.e. title company charging customer to print closing documents from secured
E-doc web-link)
Maximum $300; when charged by real estate company & shown on sales contract; real
estate broker must be exclusive agent of the borrower (prohibited if there is any financial
interest between the broker and borrower). This applies to all fees referenced as
Administrative, Brokerage, Compliance, Document Retention/Storage, Processing,
Transaction etc...
(Recording fees for Assignments cannot be charged on VA loans)
Maximum $200
Maximum $1000; when charged by 3rd party & shown on sales contract
Typically paid by Seller
Seller's charge only (exception: repo's when Seller refuses to pay).
Maximum $350 (Conventional, Rural Development & FHA Loans)
Borrower Costs and Other Fees Chart Updated (10-18-13)
Income to Lender
•
1% Origination fee from borrower
• 1% DPA Premium (1st loan amount)
• .75% Service Release Premium
• .25% Loan Incentive Fee (closing docs received
and purchased within 15 days of closing)
Total Received = 3.00%
Recapture Tax
• Buyer may be liable for recapture tax if they sell their home
within the first 9 years of ownership
• Most never pay recapture tax
• Average Household Income $40,676
• Recapture Tax Charts
• Notice to Recapture Tax
• Tax is limited to 6.25% of the initial loan amount or 50% of
net gain on sale, whichever is less
Federal Recapture Tax Income Limits--2014
120%
140%
Targeted Area
County
Alcona
Alger
Allegan
Alpena
Antrim
Arenac
Baraga
Barry
Bay
Benzie
Berrien
Branch
Calhoun
Cass
Charlevoix
Cheboygan
Chippewa
Clare
Clinton
Crawford
Delta
Dickinson
Eaton
Emmet
Genesee
Gladwin
Gogebic
Grand Traverse
Gratiot
Hillsdale
Houghton
Huron
Ingham
Ionia
Iosco
Iron
Isabella
Jackson
Kalamazoo
(Rev. 3-2014)
1-2 Member
3 or more
Family
Member Family
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$76,920
$89,740
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$77,040
$89,880
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$77,040
$89,880
$78,600
$91,700
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$77,040
$89,880
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
$72,480
$84,560
100%
115%
Non-Targeted Area
1-2 Member
Family
3 or More
Member Family
$60,400
$69,460
$60,400
$69,460
$64,200
$73,830
$64,200
$73,830
$60,400
$69,460
$60,400
$69,460
Kalkaska
Kent
Keweenaw
Lake
Lapeer
Leelanau
Lenawee
Livingston
Luce
Mackinac
Macomb
Manistee
Marquette
Mason
Mecosta
Menominee
Midland
Missaukee
Monroe
Montcalm
Montmorency
Muskegon
Newaygo
Oakland
Oceana
Ogemaw
Ontonagon
Osceola
Oscoda
Otsego
Ottawa
Presque Isle
Roscommon
Saginaw
Saint Clair
Saint Joseph
Sanilac
Schoolcraft
Shiawassee
Tuscola
Van Buren
Washtenaw
Wayne
Wexford
(Rev. 3-2014)
$72,480
$75,360
$72,480
$72,480
$77,520
$81,000
$72,480
$95,160
$72,480
$72,480
$77,520
$72,480
$72,480
$72,480
$72,480
$72,480
$79,320
$72,480
$76,560
$72,480
$72,480
$72,480
$72,480
$77,520
$72,480
$72,480
$72,480
$72,480
$72,480
$72,480
$82,320
$72,480
$72,480
$72,480
$77,520
$72,480
$72,480
$72,480
$72,480
$72,480
$72,480
$104,880
$77,520
$72,480
$84,560
$87,920
$84,560
$84,560
$90,440
$94,500
$84,560
$111,020
$84,560
$84,560
$90,440
$84,560
$84,560
$84,560
$84,560
$84,560
$92,540
$84,560
$89,320
$84,560
$84,560
$84,560
$84,560
$90,440
$84,560
$84,560
$84,560
$84,560
$84,560
$84,560
$96,040
$84,560
$84,560
$84,560
$90,440
$84,560
$84,560
$84,560
$84,560
$84,560
$84,560
$122,360
$90,440
$84,560
$62,800
$72,220
$79,300
$91,195
$64,600
$74,290
$66,100
$76,015
$63,800
$73,370
$60,400
$69,460
$64,600
$74,290
$68,600
$78,890
$60,400
$69,460
$60,400
$69,460
$64,600
$74,290
Recapture Tax Chart
First
Year
$60,400
$62,800
$63,800
$64,200
$64,600
$66,100
$68,600
$69,460
$72,220
$72,480
$73,370
$73,830
$74,290
$75,360
$76,015
$76,560
$76,920
$77,040
$77,520
$78,600
$78,890
$79,300
$79,320
$81,000
$82,320
$84,560
$87,920
$89,320
$89,740
$89,880
$90,440
$91,195
$91,700
$92,540
$94,500
$95,160
$96,040
$104,880
$111,020
$122,360
(Rev. 3-2014)
Second
Year
$63,420
$65,940
$66,990
$67,410
$67,830
$69,405
$72,030
$72,933
$75,831
$76,104
$77,039
$77,522
$78,005
$79,128
$79,816
$80,388
$80,766
$80,892
$81,396
$82,530
$82,835
$83,265
$83,286
$85,050
$86,436
$88,788
$92,316
$93,786
$94,227
$94,374
$94,962
$95,755
$96,285
$97,167
$99,225
$99,918
$100,842
$110,124
$116,571
$128,478
Third
Year
$66,591
$69,237
$70,340
$70,781
$71,222
$72,875
$75,632
$76,580
$79,623
$79,909
$80,890
$81,398
$81,905
$83,084
$83,807
$84,407
$84,804
$84,937
$85,466
$86,657
$86,976
$87,428
$87,450
$89,303
$90,758
$93,227
$96,932
$98,475
$98,938
$99,093
$99,710
$100,542
$101,099
$102,025
$104,186
$104,914
$105,884
$115,630
$122,400
$134,902
Fourth
Year
$69,921
$72,699
$73,856
$74,320
$74,783
$76,519
$79,413
$80,409
$83,604
$83,905
$84,935
$85,467
$86,000
$87,239
$87,997
$88,628
$89,045
$89,183
$89,739
$90,989
$91,325
$91,800
$91,823
$93,768
$95,296
$97,889
$101,778
$103,399
$103,885
$104,047
$104,696
$105,570
$106,154
$107,127
$109,396
$110,160
$111,178
$121,412
$128,520
$141,647
Fifth
Year
$73,417
$76,334
$77,549
$78,036
$78,522
$80,345
$83,384
$84,429
$87,784
$88,100
$89,182
$89,741
$90,300
$91,601
$92,397
$93,059
$93,497
$93,643
$94,226
$95,539
$95,891
$96,390
$96,414
$98,456
$100,060
$102,783
$106,867
$108,569
$109,080
$109,250
$109,930
$110,848
$111,462
$112,483
$114,865
$115,668
$116,737
$127,482
$134,946
$148,729
Sixth
Year
$77,087
$80,150
$81,427
$81,937
$82,448
$84,362
$87,553
$88,651
$92,173
$92,505
$93,641
$94,228
$94,815
$96,181
$97,017
$97,712
$98,172
$98,325
$98,937
$100,316
$100,686
$101,209
$101,235
$103,379
$105,063
$107,922
$112,211
$113,997
$114,534
$114,712
$115,427
$116,390
$117,035
$118,107
$120,609
$121,451
$122,574
$133,856
$141,693
$156,166
Seventh
Year
$80,942
$84,158
$85,498
$86,034
$86,570
$88,580
$91,931
$93,083
$96,782
$97,130
$98,323
$98,939
$99,556
$100,990
$101,867
$102,598
$103,080
$103,241
$103,884
$105,332
$105,720
$106,270
$106,296
$108,548
$110,317
$113,318
$117,821
$119,697
$120,260
$120,448
$121,198
$122,210
$122,887
$124,012
$126,639
$127,524
$128,703
$140,549
$148,777
$163,974
Eighth
Year
$84,989
$88,366
$89,773
$90,336
$90,899
$93,009
$96,527
$97,737
$101,621
$101,987
$103,239
$103,886
$104,533
$106,039
$106,961
$107,728
$108,234
$108,403
$109,078
$110,598
$111,006
$111,583
$111,611
$113,975
$115,833
$118,984
$123,712
$125,682
$126,273
$126,470
$127,258
$128,321
$129,031
$130,213
$132,971
$133,900
$135,138
$147,577
$156,216
$172,173
Ninth
Year
$89,238
$92,784
$94,262
$94,853
$95,444
$97,660
$101,353
$102,624
$106,702
$107,086
$108,401
$109,081
$109,760
$111,341
$112,309
$113,114
$113,646
$113,823
$114,532
$116,128
$116,556
$117,162
$117,192
$119,674
$121,624
$124,934
$129,898
$131,966
$132,587
$132,794
$133,621
$134,737
$135,483
$136,724
$139,620
$140,595
$141,895
$154,956
$164,027
$180,781
Michigan State Housing Development Authority
Homeownership
735 E. Michigan Avenue
Lansing, Ml 48912
NOTICE OF RECAPTURE TAX TO MORTGAGE LOAN APPLICANTS
(Submitted with Loan Closing)
1.
NOTICE TO MORTGAGOR OF MAXIMUM RECAPTURE TAX AND METHOD TO COMPUTE RECAPTURE
TAX ON SALE OF HOME
Introduction
General. When you sell your home, you may have to pay a Recapture Tax as calculated below. The Recapture Tax may
also apply if you dispose of your home in some other way. Any references in this Notice to the sale of your home also
includes other ways of disposing of your home. For instance, you may owe the Recapture Tax if you give your home to a
relative.
Exceptions. In the following situations, no Recapture Tax is due, and you do not need to do the calculations:
(a) You dispose of your home later than nine (9) years after you close your Mortgage Loan;
(b) Your home is disposed of as a result of your death;
(c) You transfer your home either to your spouse or to your former spouse incident to divorce, and you have no gain or
loss included in your income under Section 1041 of the Internal Revenue Code of 1986, as amended (the Code); or
(d) You dispose of your home at a loss.
Maximum Recapture Tax
The Maximum Recapture Tax that you may be required to pay as an addition to your Federal Income tax is
$________________ [Insert the actual dollar amount resulting from the product of six and one-quarter percent (6.25%)
multiplied by the highest principal amount of the Mortgage Loan]. This amount is six and one-quarter percent (6.25%) of
the highest principal amount of your Mortgage Loan and is your Federally Subsidized Amount with respect to the loan.
Actual Recapture Tax
To determine the Recapture Tax for any given year, multiply your federally subsidized amount by the applicable
holding period percentage, then multiply that result by the income percentage (see tables below).
CALCULATION OF HOLDING PERIOD PERCENTAGE
IF: Sale or Disposition Occurs During the Following
THEN: The Holding Period Percentage is:
Years After Mortgage Loan Closing,
During the first year
20%
During the second year
40%
During the third year
60%
During the fourth year
80%
During the fifth year
100%
During the sixth year
80%
During the seventh year
60%
During the eighth year
40%
During the ninth year
20%
If there have been nine (9) full years or more between the loan closing and the sale or disposition, you will not have to pay
any Recapture Tax. The Recapture Tax is limited to fifty percent (50%) of the gain realized on the sale or disposition.
Once you have multiplied the federally subsidized amount by the holding period percentage, you must then determine
your income percentage as set forth below.
2.
INCOME PERCENTAGE
The Recapture Tax you may owe will be reduced based on how your modified adjusted gross income (MAGI, defined as
your adjusted gross income as shown on IRS Form 1040 plus tax-exempt interest you earned and less gain on the sale or
disposition of the residence) at the time of sale or disposition of your interest in your home compares with the limits set forth in
the following chart.
SFH 126 (09/12)
Notice of Recapture Tax
Page 1 of 2
If your family size on the date of the sale or disposition of your interest in your home is one (1) or two (2), use the table
below:
# of Full Years Between Mortgage Loan Closing &
the Sale or Disposition of Your Interest
Prior to first full year
1 Year
2 Years
3 Years
4 Years
5 Years
6 Years
7 Years
8 Years
9 Years
NO Recapture Tax if MAGI is at or Below the Following
Federal Income Limit
No recapture tax
If your family size on the date of the sale or disposition of your interest in your home is three (3) or more, use the table
below:
# of Full Years Between Mortgage Loan Closing &
the Sale or Disposition of Your Interest
Prior to first full year
1 Years
2 Years
3 Years
4 Years
5 Years
6 Years
7 Years
8 Years
9 Years
NO Recapture Tax if MAGI is at or Below the Following
Federal Income Limit
No recapture tax
If your MAGI exceeds the limit in column two, of the applicable table above, you are liable for some Recapture Tax. If your
income exceeds the amount indicated, subtract the amount in column 2 from your MAGI, then divide that amount by 5,000.
Round the result to the nearest whole percentage point. If the result contains less than one-half of a percentage point, round
down. If the result contains more than one-half of a percentage point, round up. The result is your income percentage.
3.
CALCULATING RECAPTURE TAX
Multiply the federally subsidized amount by the holding period percentage, then multiply the result by the income
percentage. The actual Recapture Tax will be the lesser of the amount determined by this calculation or 50 percent of the gain
realized on the sale or disposition.
Please consult a tax advisor or the IRS on computation of gain and the recapture tax under Internal Revenue Code
section 143(m), and for details or if you have further questions.
4.
RECAPTURE TAX REIMBURSEMENT PROGRAM
MSHDA recognized that this may be a concern for individuals, so the Recapture Tax Reimbursement Program was
created. In the event a borrower is required to pay a Recapture Tax, MSHDA will reimburse borrowers for any Recapture Tax
paid by the borrower to the IRS. To request reimbursement, homeowners simply provide MSHDA with an IRS form 8828 and a
signed copy of their IRS 1040 form.
NOTE: If you dispose of your interest in your home purchased with the Mortgage Revenue Bond assisted mortgage loan within
nine (9) years of the mortgage loan closing date, you have the responsibility of computing and paying any amount due to the
IRS.
By signing below, we acknowledge having received a copy of this Notice of Recapture Tax To Mortgage Loan Applicants
on the date indicated.
Date: _____________________________
Applicant ____________________________________________________
Date: _____________________________
Applicant _____________________________________________________
SFH 126 (09/12)
Notice of Recapture Tax
Page 2 of 2
Recapture Reimbursement Program
• Signed 1040
• Proof of payment
• Completed IRS Form 8828
Homebuyer Education
• Required on all MSHDA DPA loans
• All adults must be certified
• MSHDA or HUD-approved counseling agencies only
– MSHDA Counseling agencies on Web
– HUD counseling agencies available www.hud.gov
Lender on Line
Must have user name and password
1) Program documents Origination & Closing Docs
Forms are data fill
2) Operating Manual
3) Completed Recapture Tax Forms
4) Reservations – Rate Lock
https://mshdalenderaccess.cgi-bps.com
FORMS
MI First Loan Submission Checklist
A loan package submitted to MSHDA for Commitment must contain the following exhibits
in the order listed below. Each document must be completed and signed where
appropriate. All MSHDA forms requiring signatures must be originals; all credit
documents may be “certified true copies.” Please do not use staples or paper clips.
Mortgage Loan Data Summary Sheet (SFH 117)
Insurance/Guaranty Certificate. Copy of FHA 92900 (Underwriting and Transmittal Summary
approved and signed by DE underwriter), VA 26-6393 Loan Analysis (signed by the lender’s Underwriter),
or USDA-RD Conditional Commitment for Single Family Housing Loan Guarantee.
FNMA 1008 – Transmittal Summary (Conventional and RD loans only), signed by lender’s
underwriter
DU/LP/Scorecard Findings (if applicable)
Loan Application (FNMA 1003). Signed by all borrowers.
Homebuyer Counseling Certificate (from MSHDA or HUD Certified Counselor) on all Down
Payment Assistance loans, for all mortgagors
Satisfactory evidence of Social Security number issued to Applicant (Social Security card, W-2, pay
stub, etc.) and Driver’s License
Credit Report(s) – merged 3-file
Verification of all Household Income:
(a) Verification of Employment (FNMA 1005), OR
(b) If self-employed, last two years’ complete federal tax returns and a current profit and loss (income and
expense) statement prepared by an accountant, OR
(c) Alternative documentation will be accepted under the following conditions.
If the lender cannot obtain all of the items below, then standard employment documentation (VOE)
must be used
1.
Telephone verification including, but not limited to date of hire; current position; date of
telephone verification; and name, title and phone number of person verifying employment. The
person verifying information on behalf of the lender must execute the statement
2. Most recent year-to-date computer generated pay stub reflecting the borrower’s name, hourly rate
of pay, year-to-date earnings, and number of hours worked per pay period. The pay stub must be
dated no earlier than 30 days from the date the loan submission package is received by MSHDA,
and it must include at least 30 days of year-to-date earnings. Should the LP/DU determination
require additional source documents and/or verifications to verify income, these must be provided
with the Loan Submission Package for compliance review.
3. Certified copies of the last two years’ W-2s, which include the borrower(s) name, social security
number, company name and total compensation.
(d) All other income must be documented according to MSHDA and loan type guidelines
Loan Submission Checklist
DOH 009 (Rev 10.14)
1
4.
Should a lender be unable to acquire a Verification of Employment (VOE) for an individual
borrower in active or reserve military or civil service, MSHDA will accept the borrower’s last two
Leave and Earnings Statements (LES) and their previous year’s W-2 form in place of the VOE
Verification of Assets
(a)
(b)
(c)
(d)
Verification(s) of Deposit (FNMA 1006) and, or
Gift Letter(s) and verification of donor’s availability of funds
Land Ownership
Alternative documentation in lieu of a VOD will be accepted under the following conditions.
1. MSHDA will accept the most recent bank statements for all accounts for all borrowers. The bank
statements must cover thirty (30) consecutive days and be dated within forty-five (45) days of the
date the Loan Submission Package is received by MSHDA.
2. Should the LP/DU determination require additional source documents and/or verifications to
verify assets, these must be provided with the Loan Submission package for compliance review.
Purchase Agreement/Contract to Build
Appraisal (FNMA 1004) /Conditional Commitment, with a complete legal description and photographs.
A detailed site location map must also be included, including addenda as applicable
Flood Certification
Title Commitment
Initial Application Affidavit (SFH 106 REV 7-14) – ORIGINAL
Non-Targeted Area ONLY– Verification of Prior Residency. Credit Report that covers at least 3
years history OR copies of signed Federal Tax Returns with all schedules for the 3 years immediately
preceding the execution of the mortgage documents have been provided evidencing no prior
homeownership during this period OR a copy of an IRS letter stating that its form 1040A or 1040EZ was
filed for such year have been provided OR an Income Tax Affidavit (SFH 108-ORIGINAL), if 1040’s are
not required by law
Certified True Copy Statement – Signed
GFE
Required Builder Information - new homes only: Equal Opportunity Builder Certificate (SFH 110ORIGINAL). Current Builder’s License to be retained in the lender’s file
If Subordinate Lien(s) other than MSHDA Single Family DPA, a copy of proposed mortgage(s), note(s)
and other pertinent documents
Additional pertinent exhibits as may be necessary to explain any unusual circumstance of the case.
MSHDA does not require a copy of the Lender’s initial disclosures
Loan Submission Checklist
DOH 009 (Rev 10.14)
2
MSHDA USE ONLY
∼ Hold
∼ Approved
∼ Rejected
∼ CON ∼ RD ∼ FHA ∼ DPA
∼ ADR ∼ VA
∼ STEP DPA Type:
S.F.#
LT#:
Counselor Code #
DPA Loan Amount: $
MICHIGAN STATE HOUSING DEVELOPMENT AUTHORITY
Attn: Single Family Underwriting
735 E Michigan Ave
Lansing, MI 48912
MORTGAGE LOAN DATA SUMMARY SHEET
Items with an “ * ” will be filled in by MSHDA. The Lender must provide all other information.
INSTRUCTIONS:
MSHDA LOAN RESERVATION NUMBER
___ ___ ___
______
*Reservation Date (MSHDA OFFICE ONLY)
______
___ ___ ___
Bond#
INTEREST RATE
___ ___ ___ ___ ___
Lender#
Reservation#
Lender Data
COMPANY’S NAME
RETURN ADDRESS FOR MSHDA COMMITMENT
CONTACT’S TELEPHONE NUMBER & EXTENTION
(
CONTACT NAME
CONTACT EMAIL
)
x
CONTACT FAX NUMBER
(
)
Borrower Data
BORROWER’S NAME
(LAST)
(FIRST)
(MIDDLE INITIAL)
BORROWER’S SOCIAL SECURITY NUMBER
CO-BORROWER’S NAME
(LAST)
(FIRST)
(MIDDLE INITIAL)
CO-BORROWER’S SOCIAL SECURITY NUMBER
∗
∗
∗
BORROWER’S
AGE
BORROWER’S
SEX
MARITAL
STATUS
TOTAL PERSONS
IN HOUSEHOLD
DEPENDENTS
(NOT B/CO-B)
# EMPLOYED
∗
∗--∗
∗--∗
*ANNUAL TOTAL
HOUSEHOLD INCOME
HAZARD INS. PREMIUM/MO.
PMI/MIP INS. PREMIUM/MO.
$
$
$
∗--∗
∗
∗--∗
Y or N
*INSURANCE Name/Code
∗
∗
PRIOR
HOMEOWNER?
DISABLED?
$
FLOOD INS. PREMIUM/MO.
∗
∗
∗
∗
∗
* ETHNIC
CODE
Y or N
PMI CERTIFICATE NO. OR FHA/VA CASE NO.
Property Data
SUBJECT PROPERTY STREET ADDRESS
COUNTY
* PURCHASE PRICE
$
CITY
CENSUS TRACT
SQ. FT.
*ACQUISITION PRICE
$
TARGETED / NON-TARGETED
TOTAL ROOMS #
APPRAISED VALUE
ZIP CODE
BEDROOMS #
BATHS #
*HOUSING TYPE
YEAR BUILT
PROPERTY TAX / PER MONTH
NEW / EXISTING
$
MANUFACTURED HOUSE
CONDOMINIUM
Y or N
Y or N
CONDOMINIUM ASSOCIATION FEES
$
NEW CONDO # (MSHDA ONLY)
$
Financial Data
MORTGAGE LOAN AMOUNT
$
SFH 117 (03-10)
Mortgage Loan Data
*APPLICATION DATE
*COMMITMENT DATE
*LOAN TYPE CODE
Michigan State Housing Development Authority
Homeownership
735 E. Michigan Avenue
Lansing, MI 48912
THERE ARE IMPORTANT LEGAL CONSEQUENCES TO THIS LEGAL AFFIDAVIT
INITIAL APPLICATION AFFIDAVIT
(Submitted with Loan Application)
This affidavit is an essential part of an application to a private mortgage lending institution (herein referred to as the
Lender) for a mortgage loan (herein referred to as the Mortgage Loan) for the purchase of a single family residence. If the
application is approved, the Mortgage Loan will be originated by the Lender and sold to the Michigan State Housing
Development Authority (herein referred to as the Authority) under a specific program funded with the proceeds of taxexempt mortgage revenue bonds, (herein referred to as the Program).
The affidavit is intended to serve two purposes: to establish that the Mortgage Loan will be eligible for sale to the
Authority under the Program in conformity with State and Federal requirements, and to make certain that you understand
the nature and extent of the limitations and restrictions which are a part of the terms of the Mortgage Loan.
READ THIS AFFIDAVIT CAREFULLY TO BE SURE THE INFORMATION IS TRUE AND COMPLETE. If you are
uncertain as to the meaning of any questions, ask an authorized representative of the Lender for an explanation.
COMPLETE ALL QUESTIONS. If any question is not applicable, answer N/A.
************
The Applicant(s), as an essential part of the application for the Mortgage Loan, hereby swear and affirm:
A. ELIGIBILITY OF APPLICANT(S)
1. The Applicant(s) have not had a present ownership interest in a principal residence (other than a mobile home that
was not permanently affixed to real property) at any time during the three (3) years preceding the date the Mortgage
Loan will be executed. For properties located in Targeted areas, this criteria is not applicable.
NOTE: For purposes of Paragraph A (1), a present ownership interest includes all forms of ownership except:
A.
B.
C.
D.
E.
A remainder or reverter interest;
A lease with or without an option to purchase;
An expectancy to inherit an interest in a principal residence;
An interest that a purchaser of a residence acquired by executing a purchase contract;
An interest in other than a principal residence; and a residence that is not occupied as a principal residence, e.g.
a vacation home or rental property;
F. An interest in factory-built made housing (i.e. mobile home), which is not permanently affixed to real property.
2. Each Applicant certifies that:
A. Any source of income is reported under Gross Monthly Income on the Loan Application (1003) and represents all
current sources of income for all individuals who are eighteen (18) years of age or older who will be living in the
single family residence, which will be purchased and financed with the Program. Gross monthly income includes,
but is not limited to: monthly gross pay, overtime, part-time employment, commissions, bonuses, dividends,
interest, royalties, pensions, Veterans Administration compensation, rental income, alimony, child support, public
assistance, sick pay, Social Security benefits, unemployment compensation, income from trusts, and income
received from business activities or investments. Gross monthly household income does not include income of an
unusual or temporary nature.
B. Any Individual Federal Income Tax returns that are attached are true and correct signed copies of his or her
Individual Federal Income Tax returns, as filed with the Internal Revenue Service.
B. RESIDENCE AND LOCATION
1. If the residence is a mobile home or other manufactured housing, (a) it is or will be permanently affixed to a
foundation on real property located at such address, and (b) the Applicant(s) intend to and will keep it so affixed
throughout the term of the Mortgage Loan.
SFH 106 (7-14)
Initial App Affidavit
Page 1 of 3
2
Each Applicant certifies and represents that he or she intends to and will occupy the residence as his or her principal
residence and not as a second home or vacation home within sixty (60) days after the closing of the Mortgage Loan.
Each Applicant further certifies and represents that the residence will not be rented or leased to any person
during the term of the Mortgage Loan without the prior written consent of the Authority and acknowledges
that the Authority may be unable to grant its consent under applicable law.
3. The Applicant(s) certify and represent that (a) no more than fifteen percent (15%) of the total finished enclosed area of
the residence is intended to be used primarily in any trade or business activity that would qualify for Federal Income
Tax purposes for a home business expense deduction, and (b) if the land on which the residence is located and any
outbuilding located on such land is intended to be used in any trade or business activity that would qualify for Federal
Income Tax purposes for a home business expense deduction, then (i) such use is merely incidental to the use of the
property as the residence of the Applicant(s) and (ii) the value of such use, as determined in the appraisal, is excluded
from the calculation of the sales price and is not financed with the proceeds of the Mortgage Loan.
4. If the residence is newly constructed, the Applicant(s) certify and represent that none of the Applicant(s) and no other
household resident (a) is presently occupying the residence or (b) will occupy the residence prior to accepting the
Lender’s written commitment letter for the Mortgage Loan.
C. USE OF LOAN PROCEEDS AND COST OF RESIDENCE
1. The Applicant(s) certify and represent that no proceeds of the Mortgage Loan will be used to:
A. Purchase any land in excess of an amount reasonably required to maintain the basic livability of the residence; or
B. Pay any settlement or financing costs relating to the Mortgage Loan (other than FHA mortgage insurance
premiums or Rural Development Guaranty fees to the extent approved by the Authority) or the cost of any
personal property (other than fixtures) to be used in connection with the residence; or
C. Repay, directly or indirectly, any existing loan on the residence other than a construction or bridge loan having a
term of twenty-four (24) months or less.
2. A. The Applicant(s) certify and represent that the sales price set forth in the contract and any addendum signed by
them with the present owner(s) of the residence (collectively, the Seller) represents the entire cost of the
residence to be paid by the Applicant(s) (or any person acting on their behalf) to or for the benefit of the Seller. A
true and correct copy of the sales contract was provided to the Lender for inclusion in the Compliance Review file.
B. The Applicant(s) certify and represent that the values listed in the sales contract for items of personal property
(other than fixtures) to be purchased by the Applicant(s) from the Seller in connection with the sale of the
residence are true and correct.
C. The Applicant(s) certify and represent that there are no other contracts, agreements or understandings between
the Applicant(s), or any person acting for the Applicant(s), and the Seller or any other person relating to:
(1) The purchase of the residence and any related personal property or fixtures;
(2) The furnishing of any services, e.g. painting, plastering and landscaping, to be performed in connection
with the residence;
(3) The completion, addition, or re-quipping of the residence; and
(4) The purchase of any other real or personal property in connection with the purchase and occupancy of
the residence.
D. The Applicant(s) understand that the Purchase Price of the residence may not exceed limits published by the
Authority and certify that the total purchase price of the house and land as a completed residence is not greater
than $224,500.
NOTICE TO BUYERS
1. Your home purchase is being financed with a mortgage made available with the assistance of the Authority. This
mortgage is made at a competitive interest rate. Because of this, your mortgage provided that you cannot sell your
home to a person ineligible for assistance from the Authority, unless you pay your loan in full. If you sell your home to
a party ineligible for Authority assistance, the Authority will demand immediate full repayment of the loan. This could
result in foreclosure of your mortgage and repossession of the property. In addition, if you rent the property or
committed fraud or intentionally misrepresented yourself when you applied for the loan, the lender may foreclose your
mortgage and repossess the property. If the lender takes your home through a foreclosure of the mortgage because
of these reasons, HUD/VA will not be able to help you.
SFH 106 (7-14)
Initial App Affidavit
Page 2 of 3
2. If the money received from the foreclosure sale is not enough to pay the remaining amount of money you owe on the
loan, the Authority may obtain a deficiency judgment against you (a court ruling that you must pay whatever money is
still owed on the loan after the foreclosure sale). Such judgment will be taken over by HUD/VA if the Authority files an
insurance claim against HUD/VA because of the foreclosure. HUD/VA may then bring action against you to collect
the judgment.
MISCELLEANEOUS
1. The Applicant(s) have been advised and understand that, except in circumstances when the Authority may consent to
an assumption in accordance with its rules and regulations without jeopardizing the tax-exempt status of its bonds, the
MORTGAGE LOAN WILL BECOME DUE IN FULL UPON THE SALE OF THE RESIDENCE. The execution by the
Applicant(s) (or any Applicant individually) of a land contract, contract for deed, wrap around or other similar
agreement that transfers the benefits and burdens of ownership and/or the occupancy of the residence (or any
Applicant’s rights) is a sale of the residence for this purpose and will cause the entire amount of the MORTGAGE
LOAN TO BECOME DUE.
2. The Applicant(s) have been advised and understand the Applicant(s) may be subject to Recapture Tax under
the Internal Revenue Code. The Recapture Tax may be applicable if the residence is sold within (9) years of the date
from which the Mortgage Loan is closed, if the Applicant’s income has increased to more than an amount prescribed
by the Code and if the residence is disposed of with a net gain on sale. (Additional information can be found on the
Authority’s Web site: www.michigan.gov/mshda.
3. The Authority recognizes that the Recapture Tax may be a concern for individuals, so the Recapture Tax
Reimbursement Program has been created. In the event a borrower is required to pay a recapture tax, the Authority
will reimburse borrowers for any recapture tax paid by the borrower to the IRS. To request reimbursement,
homeowners simply provide the Authority with an IRS form 8828 and a signed copy of their IRS 1040 form.
FALSE STATEMENTS AND CRIMINAL PENALTIES
In the event that I (we) receive a mortgage loan, I (we) hereby acknowledge that any false pretense, false statement,
misrepresentation or material misstatement made by me (us) creates a legal and binding obligation for me (us) to make
full repayment of the mortgage loan, and the lender can foreclose the mortgage to enforce the obligation. In addition, I
(we) acknowledge that if any person, with an intent to defraud or cheat, designedly by false pretense, including any false
statement or misrepresentation, obtains money, real or personal property, or the use of any instrument, facility, article or
other valuable thing or service pursuant to my (our) participation in any Authority program, shall be guilty of a crime. Such
person may be guilty of either a misdemeanor or a felony, punishable by imprisonment for not more than ten (10) years or
a fine or both, all as set forth in Section 47 of Act No. 346 of the Public Acts of 1966, as amended (MCL 125.1447).
Date ___________________________
Borrower_____________________________________________
Date ___________________________
Co-Borrower __________________________________________
ONLY BORROWERS WHO WILL OCCUPY THE PROPERTY SHOULD SIGN THIS FORM
STATE OF MICHIGAN
COUNTY OF
)
)
The foregoing instrument was subscribed and sworn before me this
day of
Notary Public, State of Michigan,
County of
My Commission Expires:
SFH 106 (7-14)
Initial App Affidavit
Page 3 of 3
, 20
.
Michigan State Housing Development Authority
Homeownership
735 E. Michigan Avenue
Lansing, MI 48912
EQUAL OPPORTUNITY BUILDER CERTIFICATE
I hereby certify that I will comply with all equal housing opportunity requirements of the Michigan State Housing
Development Authority (MSHDA) during my participation in its Homeownership Program.
These requirements are:
1. Equal employment - The hiring of employees or the contracting of all work related to any construction
performed during my participation in the MSHDA Homeownership Program will be open to all persons,
regardless of race, color, creed, national origin or ancestry, sex, or marital status.
2. Equal housing opportunity - All houses for which I am the principal contractor during my participation in
the MSHDA Homeownership Program will be offered for sale and sold on a basis that is open to all persons,
regardless of race, color, creed, national origin or ancestry, sex, or marital status.
3. Advertising - Consistent with the above provisions of equal housing opportunity, I will advertise equal
housing opportunity in all my advertising during my participation in the MSHDA Homeownership Program.
This includes the use of the equal housing opportunity logo with the words “equal housing opportunity” in
proximity to the logo in all display advertising, and the words “equal housing opportunity” to be used in all
column, radio, or television advertising.
The undersigned acknowledges that if any person, with an intent to defraud or cheat, designedly by false
pretense, including any false statement or misrepresentation, obtains money, real or personal property, or the use of
any instrument, facility, article or other valuable thing or service pursuant to his/her participation in any Michigan
State Housing Development Authority program, shall be guilty of a crime. Such person may be guilty of either a
misdemeanor or a felony, punishable by imprisonment for not more than ten (10) years or a fine or both, all as set
forth in Section 47 of Act No. 346 of the Public Acts of 1966, as amended (MCL 125. 1447).
Date
Company Name ____________________________________________
As it appears on actual license
By ____________________________________________
Signature
Title ____________________________________________
SFH 110 (07/09)
Equal Opportunity Builder Cert.
MSHDA Homeownership Division Staff Directory
Director
Mary Townley (517) 373-6864 townleyM1@michigan.gov
Administrative Support (517) 373-6840
Kathy Quigley (517) 335-6023 quigleyk@michigan.gov
Operations/Hardest Hit® Program Manager
Katy Twining (517) 241-0722 twiningm@michigan.gov
Status Checks & Reservations (517) 373-6840
Sarah Bohne’ (517) 335-2008 bohnes@michigan.gov
Sally Hutchinson (517) 241-0030 hutchinsons@michigan.gov
Underwriting
Chris Blank (517) 373-0517 blankc@michigan.gov
Laurie Temple (517) 335-7263 templel@michigan.gov
Funding
Rebecca Leiby (517) 241-0309 leibyr@michigan.gov
Quiana Lowe (517) 241-8988 loweq@michigan.gov
Final Documents
Nancy Binkley (517) 373-2273 binkleyn@michigan.gov
Property Improvement Program (PIP)
Ann Grambau (517) 373-8870 grambaua@michigan.gov
Program and Business Development Manager
Carol Brito (517) 373-9866 britoc@michigan.gov
Administrative Support
Tara Gilman (517) 241-4351 gilmant@michigan.gov
Jacinda Anderson (517) 241-3531 andersonj46@michigan.gov
Business Analyst and Technical Support
Linda Buskulic (517) 241-4826 buskulicl@michigan.gov
Business Development
Nancy Baker (517) 373-1058 or mobile (517) 243-0329 bakern1@michigan.gov
Eric Dusenbury (517) 373-6807 or mobile (517) 242-8169 dusenburye@michigan.gov
Darren Montreuil (517) 373-3393 or mobile (248) 921-1206 montreuild@michigan.gov
Housing Education Program
Sharon Evans (517) 373-8016 evanss@michigan.gov
Renee Ferguson (517) 373-8045 fergusonr1@michigan.gov
Karen Lawson (517) 373-2307 lawsonk@michigan.gov
Operations FAX Number: (517) 335-7081
Bus. Dev/Housing Counseling FAX Number: (517) 241-1177
Web Site: michigan.gov/mshda
Lender on Line: https://mshdalenderaccess.cgi-bps.com
Step Forward Michigan/Hardest Hit®
Web Site: stepforwardmichigan.org
Toll-free Call Center (866) 946-7432
Revised 9/14