Eugene Loan Guy

The City of Springfield and the City of Eugene administer programs to help low to moderate income purchasers get into their first home. They are called SHOP and HAP, respectively. This is an acronym for Springfield Home Ownership Program and (Eugene) Homeowner Assistance Program. These assistance programs were created to encourage home ownership in Springfield and Eugene by assisting low income first time homebuyers with their real estate purchase.

The programs are designed to help first time home buyers with the down payment and closing costs in their purchase. A $10,000 interest free, payment free second mortgage is available for this purpose. The loan is accepted by FHA as a viable method of obtaining down payment money and is also accepted on some conforming products.

Prospective SHOP and HAP recipients are required to complete The ABC’s of Homebuying seminar. The course is designed to help you decide if buying a home is right for you and to understand the home buying process. The class is presented by NEDCO (Neighborhood Economic Development Corporation) and taught by experienced volunteers. The class is generally scheduled for one Saturday each month. Please check NEDCO for details.

Basically, the rules are pretty simple. First, the buyer must qualify by being under the income cap, currently from $31,100 to $51,500, depending on family size. Next, you must be pre-approved for a loan program that will accept this form of down payment and closing cost assistance. SHOP and HAP most often work best with an FHA loan, but I have also used it with a VA loan. The conventional loans are a bit harder, but can be done if the credit is good. It may or may not work with an FHA 203k streamline. This FHA program will accept SHOP and HAP but SHOP and HAP might not accept the repair option.

Then, find the house that suits you. If you need a Realtor, I am more than happy to recommend one. There are housing requirements. For instance, it must be owner occupied or vacant, unless you are renting it. The program funding these loans does not want to force current renters out on the street. SHOP and HAP currently have funds at this time, but that is subject to change as the funds are used. However, it appears unlikely that the Springfield program will run out of money. Here is the link to SHOP and HAP websites. Please note the list of lenders on SHOP is dramatically out of date. A lot of the lenders on the list don’t exist any longer. We, Alpine Mortgage Planning, are approved to work with the program.

Buying a home is a major step in anyone’s life. That is one of the reasons the program requires the ABC’s of Homebuying seminar. It is a great program for anyone to partake, even if you aren’t applying for one of these loans. These programs are funded with money from HUD and are excellent ways to help first time home buyers. With the elimination of the Down Payment Assistance (DPA) programs, we need to find every way possible to help our new first time home buyers in this market place.

One interesting side note, if the buyers has a non occupant co-buyer on an FHA loan, the co-buyer can help the buyer qualify (income) for the primary mortgage loan but that income is not counted (against the cap) for qualifying for the secondary loan. Additionally, all household income is counted when determining if someone qualifies for the no interest loan. There are, as always, some exceptions. I am always here to answer questions. Also, this program requires an investment of $1,500 from the buyer for Springfield, not Eugene. This can be a gift or seller concession.

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