South Florida Community Development Coalition

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2010 Policy Advocacy Discussion Paper
A list of ideas under consideration but which have not yet been adopted by the South Florida Community Development Coalition. Click here to leave a comment or suggestion

• Miami Dade County Grant Applications


• Revamp the grant making process at Miami Dade HCD. The current system is archaic, slow, and non-green. Applicants have to deal with reams of paper, instructions that are vague and misleading, and the requirement to repeatedly submit documents that HCD already has. Applications should be made totally web-based so that there is no need to submit paper (which is the procedure that has been adopted by a number of major foundations)


• Miami-Dade First Time Homebuyer Financing
  
  
  • Banks should be able to know exactly how much County financing will be available for each particular buyer prior to the time that the bank begins its underwriting. All too frequently closings are delayed because the bank miscalculated the amount that would be provided by the County in its second mortgage loan.(go to "Discussion")
    
    
  • When a house being purchased fully complies with all relevant building and safety codes Miami-Dade HCD should not impose additional physical standards as a precondition for providing purchase financing. (go to "Discussion")
  
  
  • If the above recommendation is ignored, any additional physical standards imposed by the County should be published on their website so that buyers and realtors know the specific requirements prior to contract signing
  
  
  • County inspections should be done at the time of loan approval not a day or two before the scheduled closing
  
  
  • Don't use a "lottery" to allocate subsidy. Instead, use an on-line reservation system. Under the present system commitments are given to people that "may" (or may not) buy a house rather than to persons with actual purchase contracts - (go to the "Discussion" section below)
    
    
  • A continuing education program should be implemented for the County's home ownership specialists and underwriters
    
    
    • federal and state real estate and financing laws are constantly changing
    
    
    • the County, like other lenders, is subject to RESPA, Truth in Lending, the SAFE Act, and the Florida licensing requirements for mortgage brokers and mortgage lenders - It is highly likely that the County is not in compliance with some of these regulations
    
    
• Development of Rental Housing


• Reduce the amount of time that it takes to close on Miami-Dade County loans


• Reduce the amount of time that it takes for the Miami-County to disburse loan funds.


• The City of Miami and Miami-Dade County should give priority for projects that serve lower income groups


• Defer payment of impact and other fees until CO


• When feasible, Miami-Dade County and City of Miami loans should be closed simultaneously with project loans being provided by other lenders.


• Miami-Dade County and the City of Miami should be flexible in their loan documents to accommodate the requirements of the other lenders.


• When making loans to for-profit developers Miami-Dade County and the City of Miami should require that there be a nonprofit partner and that the deal provide a sufficient measurable benefit to the community in which the project is being developed. Click here for a discussion paper on this topic


• When there is both a bank and Miami-Dade County providing funding for a project the County should consider disbursing the funds through the bank in a single disbursement process (pursuant to an Inter-Creditor Agreement)


• Building Permits and Inspections


• Building inspectors should be required to cite the specific applicable section of the building code when they decline to grant an approval following an inspection.


• Low Income Housing Tax Credits


• In awarding tax credit allocations the Florida Housing Finance Corporation should give additional points to projects that are solely sponsored by nonprofit developers.


• The rules governing the allocation of tax credits should challenge for-profit developers to submit applications that offer substantive and quantifiable "Material Participation" for non-profit partners

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Discussion:
Miami Dade County Home Ownership Programs
(back to the top)

Background:  The County provides second mortgage affordable financing to "first time homebuyers" in four situations:

1. Persons selected in a County run lottery
• an attempt to distribute funding in a geographically equitable system allocating financing to people that "may" (or may not) buy a house rather than to persons with actual purchase contracts.
2. Purchasers from a developer that received an allocation through the RFP process
3. Purchasers of units produced through the Infill Housing Initiative.
4. Section 8 homebuyers.

Recommendations -

• Banks should be able to know exactly how much County financing will be available for each particular buyer prior to the time that the bank begins its underwriting


• After a qualified buyer signs a purchase contract the participating lender starts the full underwriting process. The lender bases its loan amount on its understanding of what the County loan will be (given the particular financial circumstances of the buyer). The buyer then takes the bank package to the County. Recently, however, the County, without communicating to the banks, has decided to spread its money out by not giving buyer the amount that the bank thought that it would. This is done in several ways. The County loan might be approved for an amount less than initially requested by the lender, thereby creating a shortage of funds to close. The County, at this late date in the process, might suddenly require that the borrower provide the full 3% down payment out of their own funds (rather than than from the County's loan closing assistance program), or, they the might raise questions about income tax refunds from previous years, etc. All this causes delay and hardship by forcing the bank to have to re-do its underwriting. .


• When a house being purchased fully complies with all relevant building and safety codes Miami-Dade HCD should not impose additional physical standards as a precondition for providing purchase financing


• If the County wants to impose standards above and beyond the South Florida Building Code it should publish those standards on the web so that buyers know that what they are.


• Currently the information is not made readily available and buyers find out only after a purchase contract has been signed.


• Those standards should not subsequently be changed without first consulting with developers


• Don't use a “lottery” to allocate First Time Homebuyer subsidy.  Instead, use something similar to the City's reservation system.


• First come first served.


• Once a week (Tuesday morning) the County website would post how much money is available


• Applicants would make time stamped email submissions to a designated email box with an auto responder. 


• Requirements for the submission would include pdf copies of all required pre-qualification documentation including:


• buyer's name and address
• homebuyer ed certification
• executed purchase contract
• amount of money requested
• name of lender
• lender pre-approval documentation
• brokers name (if any)