Lender Guidelines: 4.2 Qualifying Residences and Mortgage Loans

Set forth below are tables showing the types of residences and first lien mortgage loans that qualify for such assistance. Definitions of certain terms are set forth below the tables.

Note: In addition to the foregoing requirements, all manufactured homes must (i) be affixed to land and constitute “real property” under Texas law, and (ii) have at least 400 square feet of living space and a minimum width in excess of 102 inches and which is customarily used at a fixed location.

The following types of residences are not eligible, regardless of loan type:

• Mobile homes (whether or not permanently affixed to land)

• Rental homes

• Cooperative housing

•Homes used as investment properties

• Recreational, vacation or second homes

• Motor homes, campers and similar vehicles

The following definitions apply to terms used in the tables above:

• “Condominium” means a unit in a “Condominium Development” which is a real estate development: (i) formed pursuant to the condominium statutes of the State of Texas and a recorded declaration and other constituent documents; (ii) the unit owners of which have title to a unit in a development, and may have the right to the exclusive use of certain limited common areas; and (iii) the common areas of which are administered and maintained by, but not owned by, an owners association, which may levy assessments against each unit estate.

• “PUD” (planned unit development) means a real estate development of separately owned lots, other than a de minimus PUD, with: (i) contiguous or noncontiguous areas or facilities normally owned by an owners association in which the owners of the lots have a stock or membership interest; (ii) title to the real estate under the dwelling units being held by the individual lot owners and not by the owners association; (iii) the association having title to and responsibility for the administering of the common areas, and levying monthly charges against the lot owners for common areas expenses; and (iv) membership in the owners association not being severed from the ownership of an individual unit.

• “de minimus PUD” means: (i) a planned unit development that meets the definition of a “de minimus PUD,” as defined in the Fannie Mae Conventional Home Mortgage Selling Contract Supplement or any applicable Freddie Mac document; or (ii) a planned unit development (a) whose organizational or other relevant documents provide that the lien for any homeowner assessment or charge is subordinate to the lien of any purchase money mortgage, and (b) the maximum permissible annual homeowner assessments and/or charges with respect to the property being financed, as of the closing date of the mortgage loan, is no greater than the lesser of $600.00 or 1% of the Sales Price. “Sales Price” means the price of a residence as indicated in the contract of sale, including any collateral agreements attached to or made a part of the sales contract between the borrower and the seller of the residence, exclusive of any closing costs.

For access to the full TSAHC DPA & MCC Guidelines, please click here.