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Long Island Housing Partnership - Home Down Payment Assistance

Long Island Housing Partnership is a government program that provide $15,000 towards down payment and closing costs of a qualifying home in Nassau County, New York. There are income requirements, and the purchaser must put down at least $2,000. You do not have to be a Long Island resident to apply – you just need to purchase a home in Nassau County. Applications are being accepted until December 25, 2007.

An application, with all information and documentation requested, is required to obtain a Purchaser Certificate, and you must enter into a contract of sale within three months and close within six months of obtaining the Certificate. Prior to issuance of the Purchaser Certificate, applicants who are approved for the program and certified as eligible will be required to obtain one-on-one mortgage counseling and receive a pre-qualification of a mortgage from a recognized institution. Private mortgages or no-documentation mortgages are not permitted.

The above is general information, and a complete instruction sheet and application, outlining all steps to be taken, should be obtained from Long Island Housing. They can be reached at (516) 571-0360/(fax) 571-0377. The funds are technically a loan that is forgiven if you remain the home for ten years.

If you are depending on these funds to close, you must notify your real estate attorney, since there are time deadlines that need to be coordinated. For example, from my experience, it will take approximately three weeks for the check to be issued by the County, once Long Island Housing is in receipt of all necessary requirements, including the firm mortgage commitment. Hence, a closing date needs to be put in the contract to accommodate the extra time.

Sometimes the purchaser also applies for a SONYMA mortgage, which could take even more time, since there are numerous steps in obtaining a SONYMA commitment. It seems lucrative because the interest rate is lower, and the purchaser may also receive closing cost assistance, but the purchaser has to pay PMI and the mortgage is forty years. These factors, and the extra time in closing, need to be weighed and accommodated. If you are depending upon a SONYMA loan, it should be specifically stated in the Contract of Sale. Otherwise, you could be in default if the time to close passes, and the contract called for a standard mortgage. A seller could retain the down payment if they deem that you are in default.

Although there seem to be many hoops to jump through to obtain the above funding, it could be what is needed to allow a moderate income family afford their first home in the suburbs of Nassau County.

Cynthia M. Burke, http://www.nyrealtylaw.com

Categories: Real Estate Law