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Harvey Homebuyer Assistance Program
Homeownership is a dream for many Houstonians but out of reach for many low-income residents. The City offers up to $30,000 to income-qualified Houstonians who are first-time homebuyers, who have not owned a home in the last three years, or are replacing a home that was damaged by Hurricane Harvey.
To Begin, Make sure you meet these qualifications:
- U.S. citizen or permanent resident. (This includes the co-applicant, and spouse)
- Lived in Houston during Hurricane Harvey (August 25, 2017)? - Check Eligibility
- First-Time Homebuyer OR Lost a Home in Hurricane Harvey?
- Household income at or below 120% of the Area Median Income (Español) .
- Willing to attend an 8-hour homebuyer education course?
- Able to obtain a fixed-rate mortgage from a lender?
- Not a registered sex offender?
Our assistance is a no-interest, forgivable loan secured by a lien. The loan is fulfilled if the buyer lives in the home for five years. If the buyer sells or moves out of the home before the end of five years, they will pay back the City for a portion of the original loan amount. Please note that a homeowner must also maintain homeowner’s insurance and flood insurance on the property for the duration of this five-year period.
First Steps
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Step 1
Find a Realtor.
See a list of realtors who have worked with us before.
Realtors and other professionals interested in learning more about the Homebuyer Assistance Program or helping residents take advantage of this program can sign up for our email list at the link below. Signing up will let us know of your interest and help us keep you up to date on any upcoming events or announcements.
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Step 2
Obtain a homebuyer education class certificate through a HUD-Approved Agency.
See a list of accepted locations -
Step 3
Get a pre-approval letter from a lender for a fixed-rate mortgage.
Completed the first steps?
Call to receive an Applicant ID number. You will need this for the Program Application & Intake Form in the following steps. It is strongly recommended that you provide an email address when you make this call, as your process will move faster if you can use email.
Need to check the status of your application?
The Homebuyer Assistance Program takes about six weeks, provided there are no external delays. Please note that the six weeks is measured from the time the applicant submits a complete application. We cannot begin work on an incomplete application.
Application Step Details and Documents
Phase 2 (Property Inspection/Underwriting)
Once you receive a Conditional Reservation Letter, it is time to put a property under contract.
The lender will need to submit all the documents on the Property & Lenders Checklist including:
- Property Data Sheet
- Loan Disclosure Form
- Lead Based Paint Acknowledgement
- Notice to Sellers
- Sellers Occupancy Certification Form
Please note TREC inspections will only be accepted if they were completed after construction.
The City then reviews all documentation provided while the file is in underwriting. Meanwhile, the property will go through an environmental review, then will be inspected.
If approved, the City will then issue a Commitment Letter .
Phase 3: Closing
Once you receive a Commitment Letter , you will be informed of a possible closing date and will sign the Terms and Conditions of the assistance being provided by the City.
Instructions and loan closing documents are sent to the title company and lender, who submit pre-closing documents, including:
- Wiring Instructions for funds
- Preliminary Closing Disclosure (should include funds as City of Houston DPA & show no cash back to borrower)
- Form C HbAP Insurance Benefits and Expenditures
Funds from the Harvey Homebuyer Assistance Program are wired on the day of closing. The title and lender will then submit post-closing documents, including:
- Original Executed City Deferred Payment Loan Note
- Final Certified Closing Disclosure
- See full post-closing checklist
Frequently Asked Questions - Applicants
Q: How long does the process take? - Answer
A. The Harvey Homebuyer Assistance Program takes about six weeks, provided there are no external delays. Please note that the six weeks is measured from the time the applicant submits a complete application. We cannot begin work on an incomplete application.
Q. Am I limited to a certain property type? - Answer
You can apply for assistance with any property that will serve as your principal residence, including a single-family property, condominium unit or townhouse, cooperative unit, or manufactured home on a permanent foundation.
Q: Are there any fees associated with the program? - Answer
A: The buyer must contribute a minimum of $350 towards the transaction, which could be the inspection, down payment, appraisal, etc., but no fees are paid to the City of Houston. If someone tells you that there are participation fees, please report them for fraud.
Q: Are credit reports required for all household adults? - Answer
A: No. All household income must be reported, but only the loan applicant’s credit is reviewed during underwriting.
Q: Is there a debt-to-income requirement? - Answer
A. Yes, the program requires a 33% front-end ratio and a 45% back-end ratio. The front-end ratio is calculated by adding the new monthly payment plus taxes and insurance and dividing the sum by the borrower’s monthly gross income. The back-end ratio is calculated by adding together the mortgage and all of a borrower’s monthly debt payments and dividing the sum by the borrower’s monthly gross income. For example, if a borrower has a monthly gross income of $5,000 and monthly debt payments of $2,000, their back-end ratio is 40% ($2000/$5000).
Q: Is there a credit score requirement? - Answer
A: No, the Homebuyer Assistance Program does not consider credit score.
Q: Is there a maximum home price? - Answer
A: No. The buyer can select any home that fits their needs and budget as long as the front and back-end ratios are within our guidelines.
Q: What can the assistance provided be used for? - Answer
A: The assistance CAN be used for:
- Down-payment
- Pre-paid items (homeowner’s insurance, mortgage interest, property taxes, etc.)
- Subsidize mortgage interest rate
- Reduce principal amount of first mortgage payment
- Reasonable closing costs
The assistance CANNOT be used for:
- Realtor’s commissions
Q: What is the five-year second lien? - Answer
A: When the City assists someone in buying a home, we invest in someone to live in the home for the long term. We require them to live in the home for five years, secured through a forgivable loan. The loan is forgiven at the end of the five-year residency period. At the end of the five years, please submit this Release of Lien Request to HCDDLoanServicing@houstontx.gov.
Q: What if I must sell my home or move out before my affordability period is over? - Answer
A: In these cases, the City will collect a portion of the investment proportional to the remaining residency period. To begin this process, please submit this Payoff Statement Request form to HCDDLoanServicing@houstontx.gov.
Q: What if I need to refinance my home? - Answer
A: If your mortgage information changes, you will need to share the new information with our department. Please submit this Subordination Agreement Request to HCDDLoanServicing@houstontx.gov.
FAQs - Real Estate and Lending Professionals
Q: Does this program follow FHA guidelines? - Answer
A: No. The Single Family Eligibility sets and follows its own internal guidelines. Our underwriting includes calculating debt-to-income ratio, ensuring that there are no outstanding collections for government services or utilities, and verifying that there are no defaulted student loans.
Q: Is there a cost for the City’s inspection? What does this inspection include? - Answer
A: The inspection is a free service conducted by our department. A sample of the inspection can be downloaded (alternative version . Please note that the City’s inspection does not replace an independent inspection. We strongly recommend that the buyer obtain their own inspection.
A TREC inspection is required and must be conducted after construction is completed on newly constructed properties.
Q: What is the environmental review, and why is it needed? - Answer
A: The environmental review primarily looks at where the home is located relative to the floodway and floodplains. Homes located in flood zones are required to have flood insurance to complete the purchase.
Q: Is there mandatory training that lenders and realtors must take to participate in the program? - Answer
A: No. Any lenders and realtors may participate. However, we do encourage realtors and lenders to view our workshop replay video on YouTube for additional information and to gain knowledge of the program.
Q: Who is the loan servicer? - Answer
A: The Harvey Homebuyer Assistance Program is serviced internally with our Loan Servicing Division. The loan is not amortized; however, there is a 6% fee applied to the defaulted loan balance.
Q: Can the program funds be used to pay realtor commissions? - Answer
A: No, the funds are strictly for down payment, closing costs, pre-paid items, and principal reduction. Should the buyer choose to pay a realtor commission, they will have to do so from their personal funds.
Media
View our workshop replays here on youtube for additional information.
View on YoutubeQuestions about the program?
- Email Us: homebuyersquestions@houstontx.gov
- Contact the Call Center for inquiries or to check on your application status: 832-393-0550
- Contact our Complaint/Appeal team for concerns, complaints, or appeals 832-394-6388
