Down payment assistance (DPA) is awarded to approved applicants as a deferred loan with no payments and no interest and is forgivable after a certain period of time. CDCU applies for funding from a variety of federal and private sources every year, so it is best to connect with a CDCU Intake Specialist to determine when funding is available and for which areas, or any other resources that may be of assistance. Due to limited availability, DPA awards are competitive and are awarded on a first-come, first-qualified basis.

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AVAILABILITY OF FUNDS The DPA

program funds are typically available in the fall of each year. Funds are processed and given on a first come, first qualified basis and/or until depletion of funds. No waiting lists and no funds will be reserved. The funding year ends on June 30 of each year, and all loans must have closed by that date or they will not be eligible for funds. No applications will be accepted after June 10 of each year in order to meet this deadline. There is a limited amount of DPA funds available each fiscal year. CDCU and/or municipal entity reserves the right to expand or terminate the program as funds permit. CDCU and/or the municipal entity may also set aside a portion of the funds for special projects in accordance with federal and local guidelines.

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ELIGIBLE APPLICANTS

All applicants must meet gross household income eligibility, debt ratios, residual income, cash reserve, assets, and minimum contribution requirements. Applicant(s) must be under contract (have an accepted offer) to purchase a property at the time of submitting an application. Non-occupant co-signers on the first mortgage are allowed. Income from non-occupant co-signers will not be taken into consideration when determining eligibility for DPA based on household income and applicant total debt ratio. Applicants must be able to afford the loan and debt on their own.

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ELIGIBLE HOMES

Only owner-occupied units located within program boundaries are eligible for consideration. Existing and new single-family homes, condominiums and townhomes are permitted. Duplexes, multi-family units and mobile or manufactured homes are not permitted. The purchase property must not lead to the displacement of any individual other than the seller and their immediate family in accordance to the Uniform Relocation Assistance and Real

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Household Size Maximum Yearly Household Income

1 Person $57,350

2 Persons $65,550

3 Persons $73,750

4 Persons $81,900

5 Persons $88,500

6 Persons $95,050

7 Persons $101,600

8 Persons $108,150

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Household income includes income received by all adult members over the age of 18 who will be living in the home to be purchased.

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Must be owner occupied 

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CREDIT RATING

There is no minimum FICO credit score requirement to participate in the DPA program. The credit report submitted with the application will be used to verify the applicant’s credit history.

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AWARD AMOUNT DETERMINATION

Our current award amount determination method is based on the funds needed to close indicated by the official Loan Estimate while taking into account any gifts, seller concessions and lender credits. Receiving the maximum award amount is not guaranteed. Additionally, Salt Lake County applicants must contribute 50% of the require down payment to the transaction. Total combined down payment from all sources (including DPA funds, seller paid costs, gift funds and any other assistance program) cannot exceed 10% of the purchase price, otherwise award will be reduced.

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REQUIRED FUNDS

All programs require the homebuyer to contribute a minimum of $1,000 in personal liquid funds towards the purchase transaction. Gift funds will not be considered personal funds.

 

CASH RESERVE AFTER PURCHASE

Homebuyers are required to have sufficient cash or other liquid resources such that, after closing, there are financial resources available to cover at least one month of the total monthly housing expenses included in the front-end ratio.​

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RECORDING POSITION

For purchase transactions, DPA lien position can be recorded behind superior liens such as a First Mortgage, Community Second loan or a Utah Housing loan that benefits the buyer. Cannot be lower than third position.

ELIGIBLE LOANS

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Types of acceptable financing are fixed rate loans such as FHA, Conventional, USDA and VA. There cannot be excess upfront fees defined as more than 3% of the loan amount for loans that equal or exceed $80,000 and 5% for loans less than $80,000.

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ELIGIBLE BOUNDARIES

It is the applicant’s responsibility to check the precise location area of the purchase property address on the Salt Lake County Assessor website to ensure it is within the respective program boundaries. Taylorville- Property must be within Taylorsville City boundaries according to the County assessor. Salt Lake City- Property must be within Salt Lake City municipal boundaries according to the County assessor. Salt Lake County- Eligible properties for CDBG funding must be within the boundaries of: Alta, Bluffdale, Midvale, Draper, Cottonwood Heights, Herriman, Holladay, Millcreek, Murray, Riverton, South Salt Lake, and the 5 Metro Townships of Copperton, Emigration Canyon, Kearns, Magna, White City and the balance of the Unincorporated County, according to the County assessor. *Very limited HOME funds for the following cities: West Valley, Sandy, South Jordan, and West Jordan. Must check DPA availability with these municipalities first. 

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INCOME CALCULATION DPA

income calculation can vary from lender income calculation. CDCU uses the HUD approved IRS 1040 adjusted gross income calculation method. Please see the link below for more information about inclusions and exclusions that are accepted using this method (See Exhibit 3.15) https://files.hudexchange.info/resources/documents/HO MEGuideForIncomeAndAllowances.pdf In general, the most recent 2 months of gross income is projected over the following 12- month period. Variable income such as overtime, commissions, and bonuses will only be considered if they reflect as regular on the paystubs. We take into consideration all the income documentation provided with the application as support. Upon approval the property must be acquired within six months of income verification, otherwise the income determination will need to be reevaluated.

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AWARD AMOUNT DETERMINATION

Our current award amount determination method is based on the funds needed to close indicated by the official Loan Estimate while taking into account any gifts, seller concessions and lender credits. Receiving the maximum award amount is not guaranteed. Additionally, Salt Lake County applicants must contribute 50% of the required down payment to the transaction. Total combined down payment from all sources (including DPA funds, seller paid costs, gift funds and any other assistance program) cannot exceed 10% of the purchase price, otherwise award will be reduced. 

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REQUIRED FUNDS

All programs require the homebuyer to contribute a minimum of $1,000 in personal liquid funds towards the purchase transaction. Gift funds will not be considered personal funds.

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CASH RESERVE AFTER PURCHASE

Homebuyers are required to have sufficient cash or other liquid resources such that, after closing, there are financial resources available to cover at least one month of the total monthly housing expenses included in the front-end ratio.

 

APPLICATION SUBMISSION

All applicants must submit a fully completed application with the household’s most current information and with copies of all the documents listed on the “DPA Application Checklist.” Applications submitted with any missing information or documentation will not be accepted and/or denied. Once complete information has been submitted, CDCU will evaluate eligibility and contact the applicant if additional information is needed. After completing the application review, a notification of the results will be disclosed within 5 business days of completed submission.

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HOMEBUYER EDUCATION & COUNSELING

The applicant must attend a HUD-approved homebuyer education class and submit a completion certificate from an approved course provider: • CDCU: (801)-994-7222 • Framework Online course A free 1 on 1 in person counseling session is also mandatory in addition to the homebuyer education class. The Counseling appointment is typically scheduled once the application approval is granted. Counseling completion certificate must be submitted prior to closing. Contact CDCU for more information at 801-994-7222.

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VISUAL ASSESSMENT

Before issuing DPA funds, a third party inspector will be in contact with the real estate agent or owner to perform a visual assessment of the property. The inspector will check for the presence of health and safety concerns, including visual testing for lead-based paint dangers in homes built prior to 1978 as required by federal guidelines (HUD: 24 CFR Part 35 subpart K). A report will be provided with the results and will indicate if there is any remediation required. Please be aware that current regulation states that homes being purchased using federal funding must have a smoke detector in all bedrooms and common areas of the home and carbon monoxide detectors on every level of the home. **Radon Testing is offered free of charge only to Salt Lake City DPA program applicants.

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PROCESS STEPS & TIME 25-30 days 

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