P1.1.aFor each program, maintain a written statement of program goals and objectives, community served, and geographic area covered.P1.2.aAt least every three years, evaluate your program’s effectiveness at meeting community need and review your program design (e.g. program rules, policies and procedures) to make sure it is current and reflects best practicesP1.3.aMaintain a written program administrative manual with a detailed description of all program components. Program manual should cover all of the following elements:

• Funding Sources
• Pricing
• Marketing and outreach
• Application
• Homebuyer selection
• Allowable loan types
• Refinance provisions
• Monitoring and enforcement
• Resales
• Records maintenance
• Conflict of Interest policy

P1.4.aIdentify legal counsel that is knowledgeable about affordable homeownership programs.P1.5.aAdopt and follow a written conflict of interest policy.P1.6.aMaintain an electronic information management system under which program data is complete, secure, and easily accessible.P1.6.bCollect and file sales and loan closing documents, using a checklist to make sure files are complete.P1.7.aDevelop a multi-year (at least two years) operating budget.P1.8.aMaintain a financial management system to track revenues and expenditures.P1.8.bDemonstrate fund segregation in financial statements.P1.8.cConduct audits as required by funding sources, or at least every two years.OP1.9.aDocument or reference market conditions that support the need for services.OP1.10.aEstablish a mechanism to solicit client feedback and incorporate feedback into program design.OP1.11.aBuild community awareness and support by actively communicating goals and how services promote goals.OP1.12.aMeasure homebuyer activity and program impact.P2.1.aMaintain a written statement of income and affordability restrictions imposed by funding sources.P2.1.bMaintain a written statement of program’s target market, which may be lower than that imposed by funding sources.P2.1.cClearly state pricing formula assumptions, including details about:

• Housing affordability ratio
• Housing costs (taxes, insurance, HOA dues, maintenance costs)
• Loan product (interest rate, mortgage insurance)
• Down-payment (as percentage of home price)
• Target household income

P2.2.aDesign a pricing formula that maintains affordability without the program needing to provide additional subsidy to future buyers.P2.3.aCompare the affordable base price to the price of comparable market rate homes.OP2.4.aPeriodically review and update pricing formula.OP2.5.aMaintain a written plan to address homes that do not sell within a reasonable timeframe.P3.1.aEstablish criteria for acceptable first mortgage loan products, including all of the following components:

• Loan types allowed and expressly NOT allowed
• Interest rate, expressed as a percentage or tied to an index
• Term
• Front and back end ratio
• Discount and origination points
• Loan to Value ratio
• Credit requirements

P3.1.bMaintain written procedures for first mortgage loan review and approval, addressing all of the following components:

• Required documents from homeowner and lender
• Authorization for program and lender to share information
• Response times for applicants to provide required documentation
• Timeframe for program review
• Review and approval fees (if any)
• When exceptions (if any) to program policies will be considered

P3.2.aEstablish criteria for acceptable subordinate loans, refinance loans, and home equity loans (if applicable), including all of the following components:

• Acceptable reasons for Loan request
• Discount and origination points
• Term
• Front and back end ratio
• Interest rate, expressed as a percentage or tied to an index
• Loan types allowed and expressly NOT allowed
• Max. cash out (if any)
• Loan to Value ratio
• Credit requirements

P3.2.bMaintain written procedures for the review and approval of subordinate mortgages, refinance loans, and home equity loans, addressing all of the following components:

• Required documents from homeowner and lender
• Authorization for program and lender to share information
• Response times for applicants to provide Required documentation
• When exceptions (if any) to program policies will be considered
• Timeframe for program review
• Review and approval fees (if any)

P3.3.aIdentify at least two lenders that have mortgage loan products that meet program requirements. In markets where lenders are unwilling to make loans to homes within the program, document good faith efforts to identify and secure participating lenders.P3.4.aInclude provisions in recorded legal documents that require program approval of refinancing or other encumbrances.P3.5.aIn states that allow for recorded requests for copies of notices of default, programs should record a Request for Notice for each unit in the program portfolio. In states that do not allow for recorded Requests for Notice, programs should document procedures for periodically checking with owners, lenders, and HOAs.P3.5.bDocument procedures for responding to notices of default.P3.6.aInclude provision in recorded legal documents that the program has the right to cure default on the owner’s behalf.P3.6.bInclude program right of first refusal to purchase in recorded legal documents.OP3.7.aMaintain a list of approved lenders who are educated in your program requirements, and regularly cultivate new lenders.P4.1.aMaintain a written marketing plan that includes all of the following components:

• Target market (income level, geographic region) and efforts to reach Target market
• Groups least likely to apply and efforts to reach Groups least likely to apply
• List of commercial media and advertising
• List of community contacts
• Description of staff training
• Description of how marketing performance is evaluated

P4.1.bInclude Fair Housing language and Fair Housing logo in marketing materials.P4.2.aConduct an analysis of language needs in the community at least every three years.P4.2.bMaintain a plan for marketing to and working with limited-English speakers.P4.3.aRequire and verify in writing that all buyers complete a general homebuyer education course prior to purchase.P4.4.aIn addition to a general homebuyer education course, require and verify in writing that all purchasers complete counseling and/or education specific to the particular program as part of the application process.P4.4bProvide written information to initial and subsequent buyers regarding program restrictions, including all of the following components:

• Plain language disclosure statement, reviewed and signed by buyers in advance of closing
• Calculated example of price restrictions or recapture provision
• Post-closing requirements (e.g. periodic certification, required documentation, and maintenance expectations)

P4.4.cProvide written eligibility criteria to initial and subsequent buyers covering all of the following components:

• Income calculation
• Treatment of assets
• Determination of household size
• Down payment requirements
• Credit score requirements
• Loan qualification requirements
• Allowable loan types
• First-time homebuyer requirements

P4.4.dProvide purchasers with written information about the buyer selection process, covering all of the following components:

• Selection preferences, if any
• Methods by which applications will be ranked, processed, and approved
• Lottery procedures (if any)
• How program determines which home the applicant will purchase

P4.4.eProvide sellers with written procedures on listing their home and identifying eligible buyers, including a description of anticipated costs.P4.5.aMaintain a written application review process including all of the following components:

• Who will make final decision (e.g. hearing officer, ED, board, city council)
• How to file a review request (e.g. upon written request)
• Timeframe for filing and consideration (e.g. within how many days)
• Whether applicant will have opportunity to meet with organization or present additional information
• Whether subsequent reviews are possible

P4.5.bNotify ineligible applicants in writing and provide a copy of the process for requesting a review.P4.6.aIf programs have selection preferences of any kind or eligibility requirements based on residency, consult with an attorney or fair housing agency to understand whether these requirements or preferences might conflict with Fair Housing laws.P5.1.aUse one or a combination of these resale formula models to suit your market conditions:

• Area Median Income Index Formula
• Fixed-Index Formula
• Consumer Price Index Formula
• Housing Market Index Formula
• Appraisal-based Formula

P5.2.aTrack and evaluate affordability of resales every three years and modify the formula if necessary.P5.3.aInclude provisions in recorded legal documents (e.g. ground lease, deed of trust, land title, promissory note, regulatory agreement) to prevent loss of affordable units.P5.3.bInclude provisions in recorded legal documents for public equity recapture if unit is sold out of the program.P5.4.aMaintain written resale maintenance and repair criteria, including all of the following components:

• Acceptable condition of home upon resale
• Responsibility for making required repairs prior to resale
• Process for inspecting homes prior to transfer to ensure required repairs are made

P5.4.bInclude deductions for damages or needed repairs in the resale formula, if applicable.P5.5.aMaintain a written policy regarding capital improvements, including all of the following components:

• Types of improvements eligible for credit (or a policy that clarifies that capital improvements will not be credited)
• Approval requirements
• Documentation requirements
• Procedure for claiming credit
• Formula for calculating value of improvement (appraised value, cost depreciated, etc.)
• Limit or ceiling on credits

P5.5.bMaintain a written policy to ensure that the resale price, including credits for capital improvements, remains affordable to the target market.OP5.6.aMaintain a system that will allow program staff to determine either actual homeowner equity or a close estimate of homeowner equity at any time.P6.1.aIdentify and communicate to homeowners the single public or nonprofit agency to serve as the “primary steward” of the public investment over the long term.P6.2.aProvide a homebuyer program manual, in accord with all legal agreements between the homeowner and program, detailing program policies or requirements. Manual should cover all the following topics:

• Occupancy and occupancy changes
• Subletting
• Required intervention for homeowners delinquent on mortgage (e.g. enter financial counseling, required meeting)
• Home equity lines of credit or refinancing
• Maintenance and capital improvements
• Accessing and using repair funds (if any)
• Temporary decrease, waiver, or suspension of ground lease fees/program fees (if any)
• Fees associated with delinquent or partial payments of ground lease fees/program fees (if any)

P6.3.aSend annual letter, newsletter, or e-blast to homeowners explaining their responsibilities related to program restrictions and requirements (e.g. occupancy, insurance, capital improvements, repairs, and maintenance).P6.3.bVerify evidence of owner occupancy annually.P6.4.aMaintain written monitoring and enforcement plan that includes all of the following components:

• Identification of method and frequency of monitoring
• Statement of required homeowner compliance documentation
• Procedure for following up to those who don’t respond initially
• Identification of potential program violations (non-owner occupancy, unauthorized renting, unauthorized liens, over-encumbrance, unauthorized title transfer, etc.)
• Identification of conditions that would trigger a site visit
• Process for responding to violations
• Statement of possible repercussions for violations
• Procedures for following up to violations

P6.5.aDevelop a post-purchase support program for homeowners that includes the following components:

• Homeowner education
• Financial counseling
• Home maintenance and repair workshops
• Loss mitigation
• Home repair loans, grants, or savings programs