Qualifying again after 3 years

Home Forums Purchase Program Qualifying again after 3 years

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  • #76437
    housebunny
    Member

    Hi all, I purchased through NACA almost 3 years ago. It’s my understanding that after 3 years you can sell your home and purchase again through NACA. Does anyone know the steps to become qualified again?

    #76438
    Nelsont
    Member

    So there is no rule on waiting 3 years to sell your home. You can sell your home anytime. There is however a catch and that is naca has a lien on your house for the lifetime of the loan. In order to get the lien released you need to call naca and have them release it before you can proceed with the sale. It’s a pretty simple process.

    In the first 5 years of the loan though the lien comes with a $25,000 penalty. This is not necessarily money out of your pocket it is often just subtracted from the sale proceeds so just be aware of the math if you were expecting a larger down payment on your next home.

    If you pay off your loan the lien is released automatically without penalty.

    If you are relocating to a new state for instance you are able to get the lien released without penalty if you can prove your employer relocated you.

    If you refinance out of naca you can also get the lien released though I am unsure if the penalty will be invoked. It’s possible you might be able to roll it into your new mortgage which could potentially put you underwater on the loan so be careful about that.

    If you do not get the lien released the sale will eventually be blocked when the buyer’s title company tries to transfer the deed.

    As far as re-qualifying the process is exactly the same. You will be a new member and go through intake, get an action plan, show payment shock and MRF etc.

    The only difference is that you will need to show proof your house is listed for sale prior to submitting a contract offer on your new home AND (this is the key) you will need to show proof the sale took place and the deed was transferred out of your name before you can close on your new home. Your new purchase will be put on hold by bank of America until this happens and you will get the following condition: underwriting suspend pending decline member needs to show proof of not owning property.

    This is because naca is for current non-home owners so definitely have a temporary situation planned out since rent backs are not allowed.

    Hopefully this answers your questions so you can make the right decision.

    #76460
    Kristijay
    Participant

    @Nelsont there is indeed a 3 year wait to re-purchase using NACA. You can find it on the FAQ portion of the website. I’m not sure where you got the 5 year timeframe on the $25000 lien. It may be that the rules when you closed are no longer relevant but the website and the workbooks located on there have the most current rules and regulations with a couple of exceptions.

    #76462
    Kristijay
    Participant

    @housebunny you would need to go through intake again just like a new member.

    #76473
    housebunny
    Member

    @Kristijay so what about the 5 year penalty? I saw a post that said it goes down by 5k each year so in the 3rd year it would still be $15,000 that NACA takes from the sale?

    #76475
    Kristijay
    Participant

    @housebunny I’m not sure where @Nelsont is getting this 5 year penalty information from. I closed Oct 2020 and that isn’t anywhere in my bank app or closing documents. The documents that I signed (Security Agreememt and Neighborhood Stabilization Agreement) that reference the $25,000 indicate that it is for the life of the loan unless and until the loan is paid off and/or refinanced. From the FAQ found on Naca.com, ” Members who want to sell their home obtained through the NACA Purchase Program and release the NACA lien send an email to releases@naca.com. Members who do so will get a response within 48 hours.”

    #76476
    Nelsont
    Member

    @Kristijay @housebunny

    I found where I got the 5 year info from and it was just last year so yes even though your paperwork doesn’t say it it does apply.

    Apparently refinancing is OK and a penalty is assessed on a sliding scale for the first 5 years unless you can prove a sudden required move.

    https://forums.naca.com/?topic=refinancing-out-of-naca-before-5y-mark

    #76477
    Kristijay
    Participant

    @Nelsont I don’t place any stock on blog posts that can not be verified by a signed contract. Looks like a couple of the people who responded after that specific post didn’t either.


    @housebunny
    There are people who have re-purchased after the three year mark on the unofficial naca FB page if you would like to ask them what their personal experience was. What I can tell you is that this “sliding scale rule” isn’t in the documents anywhere that I have signed.

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