Quick Guide to MaineHousing Mortgages

July 23, 2024

Mortgage Insurance

Options (MI)

FHA

Federal Housing

Administration

Rural Development

Veterans Administration

MaineHousing

Conventional

No MI

MaineHousing

Self-Insurance for

Mobile Homes

Private Mortgage

Insurance

PMI

Down Payment 3.5% 0% 0% 20% 5% 3%

Definition of loan-to-value is 100% of the lower of the sales price or appraised value. Financing of the UFMIP (up front mortgage insurance premium) is also allowed.

Note: MaineHousing does not allow financing based on the appraised value as is currently allowed in the Rural Development program.

UFMIP 1.75%

Annual .55%

UFMIP 1.00%

Annual .35%

UFMIP 2.15% or

2.40% Reservist

Annual 0%

None Add 1% to base rate Borrower monthly, single

premiums and split

premiums

Property Types Existing 1-4 units, new

1-units, condos, mobile

homes ≤ 20 years old on

owned land

Existing & new 1-units,

condos, new mobile

homes on owned land

Existing 1-4 units, new

1-units, condos, mobile

homes ≤ 20 years old on

owned land

Existing 1-4 units, new

1-units, condos, mobile

homes ≤ 20 years on

owned or leased land

Mobile homes ≤ 20 years

old on owned or leased

land. Units located in

mobile home parks require

a recorded lease with the

same term as the

mortgage loan.

Existing 1-4 unit, condos,

manufactured homes.

For properties located

only in Auburn, Bangor,

Lewiston, Portland, So

Portland and Westbrook

Lot size limits - 3 acres for existing homes or 1 acre for new homes;

more acreage allowed when local zoning requires a larger minimum lot size or land value is 30% or less of total appraised value.

Advantage May be applied towards

3.5% Down Payment

May count up to 2% of the

5% Down Payment

Follow mortgage insurer

guidelines

Can provide $5,000 toward down payment or closing cost assistance.

Borrowers must make a minimum borrower contribution of 1% of the loan amount into the transaction and complete a Homebuyer Education class

from a hoMEworks-approved provider.

Purchase Price &

Loan Limits

Most Maine homes fall within MaineHousing’s purchase price limits. When FHA or VA loan guarantees are

used, additional loan limits may apply. See mainehousing.org/firsthomelimits.

$200,000 on leased land

$250,000 on owned land

Same as First Home

program limits

Underwriting Maximum Ratios – Housing Ratios 33% PITI or per Automated Underwriting System Approve/Eligible.

Total Debt Ratio 45% maximum. Minimum Credit Score of 640.

Mortgage loans must be underwritten to guarantor’s underwriting guidelines. Underwriters may consider Total Debt Ratios above 45% and

credit scores below 640 if the loan has supporting compensating factors. The underwriter must submit an Underwriting Risk Assessment

form HMP-54 outlining the compensating factors to MaineHousing at least 3 business days prior to closing for MaineHousing’s acceptance

of the documentation.

Maximum debt to income

ratio - 45%

Minimum credit score 640

Full-File underwrite

Income Limits Most Maine homebuyers are income eligible for a MaineHousing mortgage.

When an RD loan guarantee is used, additional limits may apply. See mainehousing.org/firsthomelimits.

Loan Terms 30-year fixed rate on all property types, except mobile homes

Mobile home financing term depends on age: Age 0-10 = 30 Yrs Age 11-15 = 25 Yrs Age 16-20 = 20 Yrs

Salute ME Qualified active duty, veterans, and retired military will receive a .50% discount to our already low fixed rate.

The program also waives the first-time homebuyer requirement for veterans who may have previously owned a home.

Purchase Plus

Improvements

Up to $35,000 in home improvements, including ENERGY STAR

appliances,

may be financed with the home purchase in the same fixed rate loan. One loan - one closing.

Homebuyer

Education

Required for borrowers who use the Advantage down payment and closing cost assistance option. Recommended for all borrowers.

See mainehomeworks.org for a class schedule from an approved hoMEworks Homebuyer Education Provider.

Who is eligible

First-time homebuyers (people who have not had

an ownership interest in their home during the

last three years).

Qualiﬁed active duty, veterans, and retired

military. (Exempt from three year ownership

interest requirement. Call for details.)

Current or former owners of unattached mobile

homes on leased land.

People who qualify based on credit score and

lender criteria.

While income limits and purchase price limits apply,

most Maine homebuyers are income eligible and

most Maine homes are price eligible. To check

income and purchase price limits, see

mainehousing.org/ﬁrsthomelimits.

How to apply

All MaineHousing-approved lenders are designated

as First Home Lenders.

Contact a participating First Home Lender to see

if you qualify.

For a list of participating lenders, see

mainehousing.org/mainehousinglenders.

Homebuyer Education

A hoMEworks-approved homebuyer education

class is a great way to learn about all aspects of

ﬁnancing and buying a new home, and is

required if you use the Advantage down payment

and closing cost assistance.

News regarding recapture

Recapture is a federal tax assessed by the U.S.

Internal Revenue Service at tax time only if the

homebuyer (1) sells within nine years of purchase, and

(2) makes a proﬁt, and (3) has experienced a

substantial increase in income. Upon the sale of their

homes, the vast majority of MaineHousing borrowers

are not subject to recapture tax at all.

Important note about recapture tax reimbursement:

MaineHousing will reimburse borrowers for any tax paid

to the IRS for loans closed on or after January 1, 2013.

This eases most concerns homebuyers may have about

the possible cost of recapture tax. For more details,

see mainehousing.org/recapture.

Did you know that MaineHousing has

No asset limits?

No required seller points?

Low 30-year ﬁxed interest rates?

Financing for manufactured homes?

207-626-4600 | 1-800-452-4668

Fax 207-626-4652 | Maine Relay 711

mainehousing.org

Maine State Housing Authority (“MaineHousing”) does not discriminate on the

basis of race, color, religion, sex, sexual orientation, gender identity or expression,

national origin, ancestry, physical or mental disability, age, familial status or

receipt of public assistance in the admission or access to or treatment in its

programs and activities. In employment, MaineHousing does not discriminate

on the basis of race, color, religion, sex, sexual orientation, gender identity or

expression, national origin, ancestry, age, physical or mental disability or genetic

information. MaineHousing will provide appropriate communication auxiliary

aids and services upon sufficient notice. MaineHousing will also provide this

document in alternative formats upon sufficient notice. MaineHousing has

designated the following person responsible for coordinating compliance with

applicable federal and state nondiscrimination requirements and addressing

grievances: Lauren Bustard, Maine State Housing Authority, 26 Edison Drive,

Augusta, Maine 04330, Telephone Number 1-800-452-4668 (voice in state

only), (207) 626-4600 (voice) or Maine Relay 711.

mainehousing.org

A Quick Guide to

MaineHousing

Mortgages