These programs are great in our current residential housing market; where many bank owned properties dominate the market. Most of the bank owned properties are in need of various levels of repair or upgrades. These homes have been neglected by the previous owners and the current owner (banks) will not consider making any repairs.

First time home buyers and other non investors purchasing or refinancing their primary residence can benefit from three FHA programs.

FHA Energy Efficient Mortgage Program

This program allows the buyer to finance up to 5% of the purchase price (up to $8,000) with 100% financing for "Cost Effective’ eligible energy improvements. The total of the cost for the energy improvements is layered into the base loan amount. The cost of the energy improvements is can go above the loan limits in the base loan program.

This program can be used in conjunction with the FHA Weatherization Program described below. Participation in this program requires a HERS (Home Energy Rating System) Energy Audit. The cost of the audit is about $300 (buyer expense) and can be paid at the time of the audit, through escrow as a closing cost of the buyer, or with the lenders approval can be made part of the mortgage.

This program allows the buyer to finance up to 5% of the purchase price (up to $8,000) with 100% financing for "Cost Effective’ eligible energy improvements. The total of the cost for the energy improvements is layered into the base loan amount. The cost of the energy improvements is can go above the loan limits in the base loan program. The cost of the energy improvements is added to the appraisal value on the home so a second appraisal is not required.

The following list is provided to give you an idea of what types of improvements could qualify for the program. Actual improvements cannot be identified until the HERS is completed on the home. One requirement for approval is the cost of the improvements must reduce the energy costs of the home in the current condition.

1. Central Heating/Cooling (addition or replacement) 2. Replace Wall Heating Unit(s) 3. Test and Seal Ductwork for Leaks 4. Whole House Fan 5. Water Heater Replacement 6. Dual Pane Low E Windows & Sliding Glass Door(s) 7. Exterior Doors & Sun Screens 8. Solar Domestic Hot Water (DHW)

FHA STREAMLINE (K) LIMITED REPAIR PROGRAM

This program is available to owner occupants for the purchase or refinance of 1-4 unit residential properties including Condos, Manufactured homes, and mixed use properties.

Down payment and income qualifying is required and may not exceed loan limits. This program can be used in conjunction with the FHA ENERGY EFFICIENT MORTGAGE PROGRAM discussed above.

Program limit is up to $35,000 with Contractor Firm & Fixed Bid Proposals

The borrower selects the contractors. Contractors must be licensed and bonded and insured. The lender may review the contractor’s credentials. Written bid proposals are required and must include labor, materials and/or services and required permits. "Cost plus" or "time and materials" contracts are prohibited. Proposals must agree to complete the work for the amount of the cost estimate within the allowed time. "Self Help" arrangements are "strongly discouraged" unless the borrower’s have the expertise and ability to competently perform the work in a timely and workmanlike manner is self-evident and easily documented. If the borrower is performing the work under a self-help arrangement, the borrower may be reimbursed for materials purchased in accordance with the previously obtained estimates.

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