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COOK COUNTY NSPN EIG HB OR HO OD ST AB IL IZ ATIO N PR OG RAM

A homebuyer's 5-step program to purchase a Cook County NSPhome.Follow these simple steps to purchase a Cook County NSPHome.Step 1:Complywith NSPguidelines, including income qualifications.Step 2:Review the NSPproperty listings identifying the property interested in purchasing.Step 3:Select an NSPHUD-certified homebuying counseling agency and register for the required 8hours of counseling at a date and location of your choice.Step 4:Apply for a mortgage pre-approval from a participating NSP lender or a lender of yourchoice.*Step 5:Complete the NSP application and ask your realtor to present the loan pre-approval, theNSPapplication, and your offer to the developer.

Neighborhood Stabilization Program69 W.Washington Street, Suite 2900 Chicago, IL60602 Phone: (312)602-1068 Fax: (312) 603-9856*All lenders are subject to beNSP approved prior to homebuyer financing. If not approved this may create a delay in the buyer closingup tothe lending institution denying partnership with NSP.

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e , ,r . Cook County Neighborhood Stabil izat ion Programn NSP Notice to SellerThis notice is a statement that establishes that the transaction is voluntary and that the seller will not beentitled to relocation benefits; it also dictates that the property must be vacant at the time of contract. Thisnotice is required to evidence compliance with the relocation and voluntary sale rules associated with theUniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, asamended (URA).

D Income WorksheetThis Excel tool is to be usedby the developer to determine initial income eligibility of applicants. The incomethresholds are established by HUD annually. The current limits are listed in the homebuyer application. Theworksheet covers, assets (checking, savings, real estate, stocks, bonds, annuities, etc.) wages and salaries.child support, benefits, pensions, social security income, public assistance, and anyother income. This toolwill help to establish program eligibility and ability to maintain a mortgage.o Underwriting Analysis ToolThis tool is to be used by the developer to determine the amount of subsidy that required from the NSPprogram to make the mortgage affordable for the applicant. The total subsidy amount shall not exceed$50,000 per application.

o Purchase Contract with DeveloperOnly applicants who have a purchase contract with the developer may submit applications for ass tance. Acopy of this purchase contract will be included with the package. The down payment minimum is 1,000 thatmust be provided is cash as "earnest money" from the buyer (no gifts are permitted).o Commitment letter from Bank for First MortgageOnly homebuyers with an approved first mortgage are eligible to apply for assistance under Cook ountv'sNSP program. The mortgage approval does not have to be for the full amount of the sales price. ortgagecommitment letter is required to establish the amount of subsidy needed bythe home buyer thro gh theprogram. First mortgage must be a conventional 30 year term loan and the interest rate may not xceed thecurrent FHA rate by more than two percent.o AppraisalThe sales price for an NSPassisted unit is the lower of total NSP investment or market value of th unit.Market value is established by an appraisal. The appraisal is a required part of the application to e sure thatthe sales price of the unit has been established according to NSP regulations.o Income Ver if icat ion Source DocumentsThe income verification source documents checklist is included as part of the homebuyer applicat on. Sourcedocuments need to be collected and used for initial income determination by the developer. The edocuments need to be submitted with the developer application package and will be used by the ookCounty as part of the official NSP income verification.

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>...~ Cook County Neighborhood Stabil izat ion ProgramOverview of Homebuyer Assistance Requirements

The Neighborhood Stabilization Program (NSP) utilizes Federal stimulus funds to stabilize Cook Countyneighborhoods by acquiring vacant and foreclosed properties to rehabilitate or redevelop for incomeeligible home buyers. Buyers will be required to meet a number of program requirements:

First, your household must be income eligible. Household income is based on the number ofpeople living in your house. For a family of four, for instance, the household income may not begreater than $90,100;You do not have to be a first-time homebuyer, but you cannot have owned a home in the lastthree years;

You must to be able to qualify for a 30-year "fixed rate" mortgage from a lender. The NSP

program will assist to reduce the cost of the home by assisting with closing costs and secondaryloans based on each household's needs. First mortgage interest rate may not exceed thecurrent FHA rate by more than two percent;All buyers must complete 8 hours of homeownership counseling by a HUD certified housingcounseling agency - this is provided at no cost to the homebuyer;Homebuyers will be required to maintain the unit as their principal residence duringf anaffordability period, affordability periods will range from 5-20 years based on the amount ofassistance;

Ifthe home is sold during the affordability period a portion of the NSP assistance wi~ need to berepaid if there are sufficient proceeds from the sale.

Income Eligibility LimitsApplicants for NSP-funded homeownership assistance must be determined to be income eli~ible beforebeing approved for assistance. The following chart provides the current Cook County house old incomelimits.

HouseholdSize

120% AMI $63,650 $72,750 $81,850 $90,950 $97,350 $105,500 $112,.00 $120,050

1 Person 2 Person 3 Person 4 Person 5 Person 6 Person 7 Pers n 8 Person

HUO FY 2010 Income L im it s

Sale Price of Homes and Buyer SubsidyAll NSP homes will be newly constructed or fully rehabilitated and will be sold at the current marketvalue. Buyers will need to qualify for a private mortgage for some portion of the purchase rice andthe NSP program will provide the balance of funding based on the assistance needed to mak the homeaffordable for the individual buyer. The total maximum amount of assistance from the N5P rogram is$50,000.