Sec. 101. Direct down payment assistance
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In this section: The term eligible household means a household with an income that is less than 140 percent of the area median income. The terms shared equity home and shared equity homeownership program have the meanings given those terms in section 105(a). The Secretary shall establish a program to provide grants to State housing finance agencies to establish new or supplement existing down payment assistance programs for eligible households located within the State. An eligible household receiving assistance from a grant provided under this section shall— participate in housing counseling provided by— an organization approved by the Department of Housing and Urban Development; or a culturally specific nonprofit organization; and use the assistance for a down payment on a property to be used by the eligible household as a primary residence for a period of not less than 10 years.
An eligible household may use assistance received from a grant provided under this section for a down payment on any type of dwelling that shall be used as a primary residence, including a manufactured housing unit, residential property under 400 square feet, a condominium, or a cooperative. There shall be reserved 2 percent of the funds made available under this section for grantees to carry out a pilot down payment assistance program serving more than 2 co-borrowers receiving assistance from a grant provided under this section.
A grantee shall establish a 25 percent supplemental bonus down payment for eligible households that are seeking to purchase an existing shared equity home or cooperative or bring a property into a shared equity homeownership program or cooperative with funds made available under this section. The aggregate amount treated as acquisition indebtedness for purposes of this section for any period shall not exceed the limitation governing the maximum original principal obligation for a mortgage secured by a single-family residence, as determined and adjusted annually under section 302(b)(2) of the Federal National Mortgage Association Charter Act ( 12 U.S.C. 1717(b)(2) ) and section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act ( 12 U.S.C. 1454(a)(2) ).
There is authorized to be appropriated to carry out this section $1,000,000,000 for each of fiscal years 2021 through 2030. An amount equal to 20 percent of the funds appropriated under paragraph
(1)in a fiscal year shall be set aside and transferred to the Restorative Housing Justice Fund established under section 113(h). Of the amount appropriated under paragraph
(1)for each fiscal year, the Secretary shall allocate as grant funds— 98 percent to be provided to States; and 2 percent to be provided to Indian tribes in accordance with paragraph (4). Of the amount allocated for Indian tribes under paragraph (3)(B), the Secretary shall allocate funds to each Indian tribe participating in the program during that fiscal year based on a formula established by the Secretary that takes into account any factor that the Secretary determines to be appropriate. Not later than 90 days before the beginning of each fiscal year for which grants are provided to States and Indian tribes under this section, the Secretary shall publish in the Federal Register the formulas for allocation established under this subsection.
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