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Many Benefits of the Downpayment Plus Program
Maximum subsidy of $5,000 per household available in 2006
via Chicago FHLB members providing mortgages.
Serves low- and moderate-income families earning up to 80%
of the area median income.
May be used for downpayment and closing cost assistance, third-party homebuyer
counseling costs (up to $600), and/or rehabilitation costs associated with a
home purchase.
Subsidies are forgiven over a period of five years.
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| Downpayment Plus® Programs* |
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| Downpayment Plus® (DPP®)
and Downpayment Plus Advantage® (DPP Advantage®)
offer Chicago Federal Home Loan Bank (Chicago FHLB) members easy-to-access
downpayment and closing cost assistance programs for low and moderate
income homebuyers. Through these non-competitive programs, Chicago
FHLB members can reach out to and assist their customers in achieving
homeownership.
The Chicago FHLB is pleased to announce a separate pool of funds
for Program Year 2005. This additional allocation is restricted
to first-time homebuyers. For more information about this allocation,
click here. |
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| Downpayment Plus® |
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| Chicago FHLB members enrolled in the DPP Program may access subsidies
of up to $5,000 per household on behalf of eligible homebuyers to
whom they are providing first mortgages. The subsidy may be used for
downpayment and closing cost assistance, homebuyer counseling costs
(up to $600), and/or rehabilitation costs associated with the purchase
of a home. |
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| Eligible Households |
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- Total household income may not exceed 80% of the area median
income (based on income
guidelines published annually by HUD)
- Homebuyer(s) must contribute at least $750 toward the home purchase.
- Homebuyer(s) must complete a pre-purchase homebuyer or homeowner
counseling program, which provides a comprehensive financial literacy
component including information alerting borrowers to practices
characteristic of predatory lending.
- Homebuyer(s) must use the home as their primary residence.
- Homebuyer(s) must sign a 5-year retention agreement and agree
to a lien on the property for the amount of the DPP subsidy. DPP
subsidies are forgiven over a period of 5 years (1/60th per month).
In the event of property sale or removal of the AHP lien prior
to the end of the 5-year retention period, the homebuyer(s) must
repay a pro rata portion of the subsidy.
For further information on the DPP Program, review the Downpayment
Plus Program Questions and Answers.
Any member of the Chicago FHLB can enroll to participate in the DPP
Program. Participating members pay a $100 annual enrollment fee. There
is also a $150 processing fee per DPP grant. These fees can
not be passed on to the homebuyer. Each member can access
up to $200,000 in DPP funds during 2005. The funds are available on
a first come-first served basis.
*The Downpayment Plus programs are funded through the homeownership
set-aside component of the Affordable Housing Program (AHP). The Chicago
FHLB contributes 10% of its previous year's net income to the AHP each
year. The allocation is split between the Chicago FHLB's competitive
application program and the Downpayment Plus programs. The AHP is
governed by Federal Regulation 12 CFR Part 951.
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| Downpayment Plus Advantage® |
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The DPP Advantage Program is designed for households participating
in homeownership programs offered by non-profit organizations and
public agencies that provide mortgage financing directly to the homebuyer,
such as Habitat for Humanity. The non-profit organizations and public
agencies must partner with a Chicago FHLB member to access the DPP
Advantage Program.
Chicago FHLB members enrolled in the DPP Advantage Program may access
subsidies up to $5,000 per household on behalf of eligible homebuyers.
Like the DPP Program, the DPP Advantage subsidy may be used for downpayment
and closing cost assistance, financial literacy and homebuyer counseling
costs (up to $600), and/or rehabilitation costs associated with the
purchase of a home. |
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| Eligible Households |
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- Total household income may not exceed 80% of the area median
income (based on income
guidelines published annually by HUD)
- First mortgage financing must be provided by a non-profit organization
or public agency that provides mortgage financing directly to
the homebuyer(s).
- Homebuyer(s) must complete a pre-purchase homebuyer or homeowner
counseling program, which provides a comprehensive financial literacy
component including information alerting borrowers to practices
characteristic of predatory lending.
- Homebuyer(s) must use the home as their primary residence.
- Homebuyer(s) must sign a 5-year retention agreement and agree
to a lien on the property for the amount of the DPP Advantage
subsidy. DPP Advantage subsidies are forgiven over a period of
5 years (1/60th per month). In the event of property sale or removal
of the AHP lien prior to the end of the 5 year retention period,
the homebuyer(s) must repay a pro rata portion of the subsidy.
For further information on DPP Advantage, review the DPP
Advantage Program Summary.
Any member of the Chicago FHLB enrolled to participate in the DPP Program can
participate in DPP Advantage. Participating members in the DPP Program pay a $100
annual enrollment fee. The fee covers both DPP and DPP Advantage Programs. This
fee can not be passed on to the homebuyer(s).
Under DPP Advantage Program, the $150 processing fee per grant is waived.
The funds are available on a first come-first served basis. Non-profits
and public agencies can access up to $30,000 in DPP Advantage subsidies
from the pool of funds available in 2006 to assist eligible homebuyers
for which they are providing first mortgage financing. There is no
limit to the number of DPP Advantage grants a member can make. Funds
accessed under the DPP Advantage Program will not be applied toward
the $150,000 member maximum under the DPP Program. |
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Both Downpayment Plus Programs are administered by:
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In Illinois: |
Illinois League of Financial Institutions |
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(800) 237-1936; www.ilfi.org |
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In Wisconsin: |
Wisconsin Partnership for Housing Development |
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(888) 318-4486; www.wphd.org |
Members should contact the administrator in the state in which they are
headquartered to enroll in the DPP and DPP Advantage Programs or for further
information on the programs.
Homebuyers looking for downpayment assistance should contact a participating
member of the DPP Program in Illinois
or Wisconsin
to see if they qualify for a grant. |
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The Kovach family of Morton Grove, Illinois had long hoped to own their own home.
In 2003, Matt and Jennifer heard about the Chicago FHLB's Downpayment Plus grant program.
Now, just months later, the Kovachs are happy in their new home.
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Click here for complete story.
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