Voucher Homeownership Program

Owning a home is a huge responsibility and understanding that responsibility is essential to your success as a homeowner. That is why it is mandatory that you attend an approved Homebuyer Education Class prior to purchasing a home. After completing the class you will be better equipped to decide if homeownership is for you. A list of available classes is available at: http://www.mainehomeworks.org.
You can get a better idea if you are ready for homeownership by answering the following questions:
• Do you have a stable source of income?
• Have you been employed full time for the last year?
• Do you pay your bills on time, every time?
• Are you able to add to your savings monthly?
• Do you have a minimum savings of $2,000?
• Do you understand the significant responsibilities of homeownership and do you believe you are ready to make the commitment?

To be eiligible, you must meet all of the following criteria;

• The family must have been on the Caribou Housign Authority (CHA) Housing Choice Voucher (HCV) Program for a minimum of one (1) year.
• The family must be in good standing. Good standing is defined as: (a) no debts owed to CHA or current landlord, and (b) not in violation of your lease or family obligations under the HCV program.
• The family must be income eligible:
  • Non-Disabled families must have a minimum gross annual income of $22,000, based on the income of the adult family member(s) who will own the home. Income from welfare assistance may not be counted toward this requirement (HUD minimum wage x 2,000 hours).
  • Elderly families (head, spouse or co-head is 62 years of age or older) must have a minimum gross annual income of $22,000 based on the income of the adult family member(s) who will own the home. Income from welfare assistance may not be counted toward this requirement (HUD minimum wage x 2,000 hours).
  • Disabled families (head, spouse, or co-head is disabled) must have a minimum gross annual income of $14,000 based on the income of the adult family member(s) who will own the home. Income from welfare assistance may not be counted toward this requirement (HUD minimum SSI x 12 $9,396).
• At least one adult family member, who will own the home, but be working full time, at least 30 hours per week and have been employed full time at the same job for at least one continuous year. This minimum employment requirement does not apply to elderly or disabled families.
• Must qualify as a first time homebuyer per the HUD definition, which is not having owned a home within the past three years. Exception is made for single parent/displaced homemaker families that owned a home with a prior spouse.
• Must successfully complete a HUD approved Homebuyer Education class.
• Must be pre-approved by a reputable mortgage lender.
• Must sign a Statement of Homeowner Obligations prior to closing on a home.

The family is responsible for securing its own financing and may choose any lender willing to work with HCV Homeownership program. For the most part, lenders require a credit score of 640 or higher. Rural Development offers a subsidized mortgage with 100% financing that works well for many families. Some lenders will take your HCV assistance into consideration when determining how much a family can afford to borrow. Many financing options may not work within our payment standard restrictions if the mortgage payment is too high.

Balloon Payment Mortgages, Variable interest rates and seller financing are prohibited. The PHA has final approval as to whether the financing arrangement is affordable. The family’s portion may not exceed 40% of their adjusted family income.

The lender determines the amount of mortgage you can afford. This amount depends on several factors such as your income, your debt, the interest rate, and the PHA payment standard. Some financing options require the family to place a down payment on the home. The lender will pre-qualify your for a loan based on these factors. It is important to get pre-qualified by the lender prior to shopping for a home.

YES, you must have good credit! If you don’t, a credit counselor can instruct you on how to clean up your credit record and improve your credit score. Money Management International (www.moneymanagement.org) or CA$H Maine (www.cashmaine.org) are good resources for credit repair advice. However you may have never established a traditional credit record and that’s okay, but the lender will need to verify that you have a good record of paying your bills on time. The lender will review your record of making timely payments for rent, utilities and other payments. This is called alternative credit. For the most part, lenders require no late payments for the last two years or credit rating of 640 or higher.

If you have filed bankruptcy, most banks require a minimum of two years from the date of bankruptcy before you would be eligible for a mortgage loan. Money Management International

Being able to save money each month is an important habit to develop to succeed as a homeowner. Families need to save for winter fuel cost, regular maintenance and upkeep of their home and unexpected repairs. If you don’t prepare by saving for these expenses they can threaten your financial security. The housing authority’s subsidy does not cover all homeowner expenses. This has been an area of concern and difficulty for homeowners. You may be eligible for one of the following programs that can assist you in building a savings.

Family Self-Sufficiency Eligible families may participate in Caribou Housing Authority’s Family Self-Sufficiency Program. This program helps families meet their needs to become stable and if eligible you may earn money in a managed savings account as your family’s income increases from employment income. For more information, please contact Caribou Housing Authority at (207) 493-4234

New Ventures Maine has two matched savings programs. One is the Family Development Account (FDA) Program which is funded through federal grants. A limited number of accounts are available each year. This program matches each dollar you deposit into your FDA account with up to a $4 from public funding and private donors up to a fixed amount. It also provides advice on how to save and manage your money effectively, how to build good credit and how to reach your goals. The second program is a Rainy Day Savings Account (RDSA) Program. This program matches each dollar you deposit into your RDSA with $1 from private donors. Income limits apply for both programs. If you are interested in learning more about these programs please contact Jean Dempster at 1-800-442-

You will have to pay for an appraisal which costs approximately $300 – $400 and a professional home inspection which costs approximately $200 – $700.

There may be other incidental expenses prior to your purchase that you would be responsible for, such as, Application Fees, Credit Reports, Prepaid Insurance, Prepaid Taxes, Attorney fees and Title fee. Depending on how you finance your home these costs can accumulate. The normal range is from $1,500 to $4,500 in addition to your down payment. All or part of these closing costs can be paid by the seller. Some financing options allow these costs to be rolled into the loan.

Monthly mortgage payments should be no more than 29% of gross income, while the mortgage payment combined with non-housing expenses, should total no more than 40 % of gross income. Your total housing expenses must also be within the allowable payment standard for your family’s bedroom size. The family must pay any amount over and above the payment standard in addition to 30% of their adjusted monthly income.

In most cases, your family can help you purchase a home by assisting with a down payment. We do not allow non-occupying co-signors or co-borrowers.

Yes. There are actually two types of inspections that are required. You must hire an independent home inspector to inspect the home to identify any physical defects and evaluate the condition of major building system components. The Housing Authority will complete the Housing Quality Standards (HQS) inspection, which are the inspection standards used for rental assistance.

Yes. You are responsible for all monthly homeownership expenses and for any expenses that you incur as a homeowner. You will be responsible for all maintenance of the home. As mentioned earlier you need to save for the unexpected such as; roof damage, water heater replacement, furnace repair, increased taxes, etc. Owning a home is expensive. You need to carefully weigh the advantages and disadvantages between owning verses renting.

Contact the Caribou Housing Authority, at (207) 493-4234 to request an application or more information.