Sec. 201. Down payment assistance program for communities formerly segregated by law
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/bill/115/s/3503/is/section-201A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
In this section: The term eligible resident means a resident of a geographic area, as defined by the Secretary by regulation under subsection (e), who— is a first-time homebuyer; resided in that geographic area during the 4-year period preceding the date of enactment of this Act; and has an income that is less than 120 percent of the area median income. The term first-time homebuyer means an individual (and if married, the spouse of the individual) who has had no ownership in a principal residence during the 3-year period ending on the date of purchase of the property.
The term Secretary means the Secretary of Housing and Urban Development. There is established in the Office of Housing of the Department of Housing and Urban Development a fund, to be administered by the Secretary, that shall be used— to provide grants to eligible residents to purchase homes; and for outreach to financial institutions in targeted areas and eligible residents. Eligible residents may receive a grant from the fund established under subsection
(b)in an amount equal to— not more than 3.5 percent of the appraised value of the property to be purchased; or if the appraised value is more than the principal obligation amount limitation for mortgages insured under title II of the National Housing Act ( 12 U.S.C. 1707 et seq.), 3.5 percent of the maximum principal obligation limitation for the property to be purchased. An eligible resident is not required to obtain a mortgage that is insured under title II of the National Housing Act ( 12 U.S.C. 1707 et seq.) as a condition of receiving a grant under this section. Not later than 1 year after the date of enactment of this Act, the Secretary shall— finalize regulations relating to the use of the fund established under subsection (b), including defining the geographic areas in which residents are eligible to receive grants through the fund, which shall include— census tracts graded as hazardous in maps drawn by the Home Owners' Loan Corporation that are, as of the date of enactment of this Act, low-income communities; and census tracts that were designated for non-White citizens in jurisdictions that historically had racially segregated zoning codes and are, as of the date of enactment of this Act, low-income communities; finalize regulations relating to the disbursement of funds under this section to ensure that eligible residents are able to receive funds before the closing date for their home, which may include creating a program that allows a lender to be reimbursed by the fund established under subsection
(b)if the lender— provides the eligible resident with funds for the closing; or allows eligible residents to be preapproved to receive assistance under this section when arranging financing for their home; create a publicly accessible database that allows individuals, real estate professionals, and lenders to determine whether a borrower is eligible for assistance under this section; and establish methods to verify that an individual is an eligible resident. Out of funds in the Treasury not otherwise appropriated, there are appropriated to the fund established under subsection
(b)such sums as may be necessary for each of fiscal years 2019 through 2028 to provide grants under this section and to carry out consumer education efforts related to this section. Section 5(b) of the Real Estate Settlement Procedures Act of 1974 ( 12 U.S.C. 2605 ) is amended by inserting after paragraph
(14)the following: Information relating to the down payment assistance program established under section 201 of the American Housing and Economic Mobility Act of 2018 . . Section 203(f)(1) of the National Housing Act ( 12 U.S.C. 1709(f)(1) ) is amended by inserting , including the down payment assistance program established under section 201 of the after American Housing and Economic Mobility Act of 2018 mortgage products, .
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Sec. 201
Down payment assistance program for communities formerly segregated by law
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