Closing Cost Assistance Program - CCAP

Purpose

The Town of Nantucket, through its Affordable Housing Trust, offers up to $15,000 for each eligible buyer to put towards closing costs for the purchase of deed-restricted affordable units. It is intended to assist year-round residents qualifying at the 80%-175% AMI level who can afford monthly mortgage payments, yet do not have enough money to pay the initial home purchase closing costs. The goal of the program is to increase homeownership among the low and moderate income households in the Town of Nantucket. This is a zero-percent (0%) loan program subject to repayment as described below.

Eligibility

• Available to qualified applicants earning up to 175% AMI
• Applicant must provide written confirmation they have been deemed eligible to purchase a home through a DHCD-approved lottery process or have a fully executed P&S for a permanently deed restricted 175% or below AMI unit and Qualified Purchaser Certificate from a recognized Monitoring Agent
• Applicant must have a mortgage pre-qualification letter from a recognized financial institution on bank letterhead clearly indicating their qualification to purchase the unit
• The property must be located in Nantucket County
• There must be a permanent deed restriction on property guaranteeing ongoing affordability at 175% AMI or less

Other requirements / details:

• Available on a first-come, first-serve basis until the annual Trust Fund allocation for this program is depleted
• Loans are up to $15,000 solely for closing costs based on a bona fide Loan Estimate from a recognized financial institution
• Funds to be released to closing attorney following receipt of bona fide mortgage loan commitment letter, original promissory note, and post-closing agreement, and once the purchase is approved to close
• Closing cost funds loaned based on approved legitimate closing costs and limited to $15,000
• This is a zero-percent (0%) loan secured by a second mortgage on the property from the purchaser to the Trust Fund which will be recorded as a subordinate lien by the closing attorney
• The loan must be repaid when property is sold or transferred
• The loan will be subordinated if refinanced by original owner(s)
• A waiver of loan repayment may be requested by the owner/seller if the property has been held for five years or more and the gross sales amount is not $30,000 more than the original purchase price

Closing Cost Assistance Program Guidelines

The Closing Cost Assistance Program (“CCAP”) is offered through the Town of Nantucket’s Affordable Housing Trust and offers up to $15,000 for eligible buyers to be put toward bona fide closing costs for the purchase of permanently deedrestricted affordable units restricted to buyers at an 175% AMI or less income level. The program is intended for lower to moderate income home buyers who can afford monthly mortgage payments but do not have enough to pay the initial home purchase closing costs. The goal is to increase homeownership among 175% and below AMI households in the Town of Nantucket. Applications and a checklist to guide you through the process are available at the Planning Office or http://nantucket-ma.gov/184/Affordable-Housing-Trust-Fund.
You are encouraged to begin your house-hunting process by applying for CCAP early. To avoid unnecessary delays, submit your application and all required documentation a minimum of eight (8) weeks prior to your loan closing. Once qualified, your conditional letter of approval is valid for 6 months.

What Type of Assistance is Available?

The CCAP is considered a “deferred payment loan.” The loan is interest free and you will not have to pay anything back unless you sell or transfer the property. If the property is sold prior to the fifth anniversary of the sale, you will be required to pay back the full amount upon sale. After five years, the loan may be forgiven if the gross sales price is not greater than $30,000 more than the original purchase price. You must request the waiver and conditions must be sufficient for the AHTF to consider the request. A granted waiver may result in tax consequences to you. Please consult your tax adviser.

What is the Maximum Amount of Assistance?

The CCAP program will loan eligible buyers bona fide closing costs up to $15,000.

Who is Eligible?

Applicants must meet the following eligibility requirements:

• You must purchase a permanently deed-restricted affordable unit in the County of Nantucket and agree to future resale restrictions
• The home must be intended for and maintained as your principal residence
• You must complete an approved homebuyer training course and provide certification of completion • A household cannot have more liquid assets than allotted for their corresponding AMI
• You must be approved for a mortgage with a recognized commercial lender
• You must provide the loan required down payment from your own funds
• You must not exceed 175% of the current HUD annual median household income.

***Chart issubject to change based on current HUD calculations. Please refer to https://www.huduser.gov/portal/datasets/il.html for most current figures.***