FAQ About HOAP

Who is a first-time home buyer?
A first-time home buyer is a person who has not owned a home in the past two-three years.

What is HOAP and how do I apply for HOAP assistance?
HOAP stands for Home Ownership Assistance Program.  HOAP provides buyers with down payment and closing cost assistance in the form of a second and sometimes a third mortgage loan. A potential applicant to the HOAP program must be able to secure a first mortgage loan from a traditional lender such as a local bank. The applicant should let their first mortgage lender know that they want to apply to HOAP for down payment and closing cost assistance. The applicant should provide their lender with the HOAP program information and checklist so that the lender is aware of HOAP procedures. The first mortgage lender is required to forward all information requested on the checklist to NHS.

Can a HOAP applicant use any first mortgage lender they want to use?
A HOAP applicant can use any first mortgage lender that is licensed or registered through the Nationwide Mortgage Licensing System (NMLS) as long as the lender structures the first mortgage loan in accordance with HOAP guidelines. The lender must also utilize a front ratio of 36% and a back ratio of 43%.

Can my first mortgage loan be an FHA loan?
The HOAP program is not compatible with FHA. The first mortgage loan can either be a 30 year conventional, fixed rate mortgage or a PHFA mortgage.

Is HOAP assistance repayable?
Assistance through the Allentown HOAP, Bethlehem HOAP, Easton HOAP and General HOAP is repayable.

Assistance through the Lehigh County HOAP is forgiven at a rate of 20% each year and completely forgiven after the fifth year. If a home buyer sells, rents, or vacates their property before the five year period is up, the remaining principal amount borrowed has to be repaid.

Is assistance through the Community Partnership Program (CPP) repayable?
CPP assistance, a program for home buying within the City of Allentown, is completely forgiven after five years and has a 0% interest rate. If a home buyer sells, rents, or vacates their property before the five year period is up, the entire principal amount borrowed has to be repaid.

What are the HOAP eligibility requirements?
A HOAP applicant must meet income guidelines and have acceptable credit and two years of verifiable employment. An applicant must also complete  the First Time Home Ownership Program Seminars offered through Community Action Committee of the Lehigh Valley (CACLV).

What should I do if my credit is not acceptable?
The first step would be to take the First Time Home Ownership Program Seminar, which covers the whole home buying process including credit repair. After taking the seminar, an appointment can be made with a Housing Counselor with NHS for one-on-one counseling.

How do I sign up for the First Time Home Ownership Program Seminar?
In order to enroll in this free seminar, call Community Action Financial Services, a program of the Community Action Committee of the Lehigh Valley at 610-691-5620 or 484-893-1038.

Is an appointment needed to apply for down payment and closing cost assistance?
Early on in the process, an appointment should be scheduled with a Home Ownership Coordinator at NHS to get information about HOAP. The home buyer could also obtain the information from the NHS website or request that information be mailed. It is important that this information be shared with the first mortgage lender so that program guidelines are followed. The actual application for HOAP assistance is made after a property is identified and the home buyer has a commitment from a first mortgage lender. After the first mortgage lender provides all needed documentation to NHS, the Home Ownership Coordinator will schedule an intake appointment with the home buyer to determine eligibility for down payment and closing cost assistance.

How is income eligibility determined?
NHS utilizes current HUD income guidelines to determine income eligibility. Using the Income Guidelines Chart provided, a prospective home buyer can determine whether they are at 80% median income or below or whether their income is over 80% median income.