To: Honorable Mayor and Members of Town Council
Through: Tara Vargish, Assistant Director, Development Services
From: Julie Kirkpatrick, PLA, ASLA, Long Range Project Manager
Title
Resolution Authorizing the Town of Castle Rock’s Participation in the Metro Mortgage Assistance Plus Program, and Approving the Delegation and the Participation Agreement
Body
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Executive Summary
The purpose and intent of this Resolution is to continue participation in the Metro Mortgage Plus (MMA+) Program and to approve a new participation agreement. Along with several other municipalities, Castle Rock has participated in this down payment assistance program for low and moderate-income individuals and families to purchase a home. Castle Rock’s continued participation will allow residents of Castle Rock to participate in the program. The new name of the program is “metroDPA,” but all legal documents will continue to reference MMA+.
Discussion
History of Past Town Council Action
Dating as far back as 1998, Town Councils have approved Castle Rock’s participation in various residential loan programs administered by the City and County of Denver.
Metro Mortgage Assistance Plus / metroDPA Program
This down payment assistance program helps low and moderate-income individuals and families purchase a home. The applicant can purchase a single-family detached house, condominium, townhome, or duplex and must occupy the home as their primary residence. With assistance levels up to 5% of the loan, the program provides the down payment and closing cost assistance via a no interest second loan that is forgivable after 36 months. The borrower must stay in the home, not refinance, and make three years of mortgage payments for this second loan to be forgiven.
To be eligible, the borrower’s income cannot exceed $134,850, must meet the standard loan guidelines, must have a minimum FICO score of 640, have a maximum debt-to-income ratio of 45, and must complete a HUD-approved homebuyer education/counseling.
The City of Denver, which administers the program for the entire metro-Denver area, does not use any bond capacity to fund the program. The down payment assistance is provided by the value generated by the loans in the secondary mortgage market.
If Council approves the new agreement to participate in this program and to delegate the City and County of Denver to administer the program, the borrowers would be able to use the program to purchase a home in Castle Rock. Municipalities that participated in the past have also been asked to renew their participation with a new agreement. Some of those other jurisdictions include Centennial, Englewood, Littleton, Lone Tree, Parker, and Douglas County.
Budget Impact
There is no financial impact or liability to the Town. The City and County of Denver pays the startup costs and the ongoing operation costs for the program.
Staff Recommendation
Staff recommends approval of this resolution.
Proposed Motion
I move to approve the Resolution as introduced by title.
Attachments
Attachment A: Resolution
Exhibit 1: Agreement