Purpose

MHMFA will purchase Loan Participations in Mortgage Loans meeting the requirements outlined in this manual. 21.01: continued MHMFA and Sellers intend this program to be responsive to the needs of creditworthy low and moderate income prospective and existing homeowners seeking to purchase or rehabilitate properties throughout the Commonwealth, but particularly in older residential neighborhoods, which for various reasons have suffered or are beginning to suffer deterioration and disinvestment. The properties to be financed will be appraised and underwritten according to well defined criteria that contemplate individual credit standing and individual structure conditions and the goal of the preservation and conservation of existing housing stock in the Commonwealth. Each Seller will retain autonomy in making individual loans, and will assume responsibility for relaying and emphasizing the goals of the program to their personnel. Strong senior management commitment reinforced through middle management to loan officers and interviewers is a prime prerequisite if the program is to be successful. Loan applications will be takenbywell-trained interviewersand mortgage officers at the designated office of each Seller. Many of the applicants maybe first-time homeowners or inexperienced in filling out loan applications. These conditions require mortgage officers with some perceptive skills and sensitivity in order to make sound evaluation of the applicant. The loan officer will explain the reason(s) for any rejection of a loan application, and will suggest alternatives, if any, which may permit approval of a loan application. Alternatives could include changes in loan terms, addition of a co-signer to the loan, or longer term improvement in the financial situationofthe applicant or other appropriate recommendations. Sellers are encouraged to recommend counseling agencies to applicants rejected because of poor credit, job instability, etc.; however, counseling should not be limited just to rejected loan applications. Counseling agencies offering services such as general information concerning the purchase of a home, inspection services, and legal assistance in rehabilitation should all be recommended to inexperienced applicants undertaking home rehabilitation. In Neighborhood Preservation Areas the mortgage officers should develop close ties with the city or town, neighborhood groups, and the local resources for counseling and technical assistance. If requested in writing by the Seller or a loan applicant, MHMFA will evaluate a loan application and inform the Seller and the loan applicant if an application meets the requirements for purchase of a Loan Participation by MHMFA. MHMFA, based on its evaluation, mayrequest inwriting, but not require, the Seller to reconsider the loan application.