1. (a) Household assistance from the Department for any Texas Bootstrap Loan Program loans may not exceed $45,000 per household pursuant to Texas Government Code, §2306.754(b). The Owner-Builder must obtain the amount necessary that exceeds $45,000 from other sources of funds including other Department funds with the exception of funds being utilized to implement the Texas Bootstrap Loan Program. The total amount of amortized repayable loans made by the Department and other entities to an Owner-Builder under the Program may not exceed $90,000 pursuant to Texas Government Code, §2306.754(b).

2. (b) The Department shall make loans for Owner-Builder applicants to enable them to:

   1. (1) purchase or refinance real property on which to build new residential housing;
   2. (2) build new residential housing; or
   3. (3) improve existing residential housing.
3. (c) Upon approval by the Department, the Participant shall enter into, execute, and deliver to the Department the Loan Origination Agreement. The Department may terminate the Loan Origination Agreement in whole or in part if the Participant has not performed as outlined in the NOFA, Loan Origination Agreement, and/or Program Manual.
4. (d) In the event the Department has additional funds in the same funding cycle, the Department, with Board approval, will distribute funds in accordance with this chapter.
5. (e) If the Owner-Builder Applicant qualifies for the Program, the Department will issue an Applicant eligibility letter (approval letter) which reserves the funds (up to $45,000 per Reservation) for twelve (12) months from the date of the Applicant eligibility letter. Owner-Builder Applicant will not be required to re-qualify for the Program if the Owner-Builder Applicant closes on the loan on or before the expiration date stated on the Applicant eligibility letter issued by the Department. If the Owner-Builder fails to close on the loan on or before the expiration date stated on the Applicant eligibility letter, the Owner-Builder Applicant will be required to re-qualify for the Program. The Owner-Builder Applicant must be requalified by the Department. If the Owner-Builder Applicant is requalified the Department may grant an extension of up to 90 days from the expiration date on the original Applicant eligibility letter. If the Owner-Builder Applicants fails to close on the loan after the extension is granted the Reservation and/or loan will be cancelled.

6. (f) Roles and responsibilities for administering the Program Contract. Participants are required to:

   1. (1) qualify potential Owner-Builders for loans;
   2. (2) provide Owner-Builder homeownership education classes;
   3. (3) supervise and assist Owner-Builders to build and/or Rehabilitate housing;
   4. (4) facilitate loans made or purchased by the Department under the Program; and
   5. (5) implement and administer the Program on behalf of the Department.
7. (g) Loan Servicing Agreement. If the Participant wishes to service the loans originated on behalf of the Department it must enter into a Loan Servicing Agreement with the Department. The Department may grant the request upon reviewing the Participant capacity to implement those specific functions.
8. (h) First Year Consultation Agreement. The Participant agrees that if notified by the Department that Owner-Builder has failed to make a scheduled payment due under the Program loan, or other payments due under the Program loan documents issued under the Program, within the first twelve (12) months of funding, the Participant will be required to meet with the Owner-Builder and provide counseling and assistance until the payments are made current. After consultation and in the event that the Department and Participant are not able to reach a consensus about Participant's effort to bring the Program loan current as required under this chapter, the Department in accordance with its administrative rules may apply appropriate graduated sanctions leading up to, but not limited to deobligation of funds and future debarment from participation in the Program.
9. (i) Administrative Fee. The Participant will be granted a 6 percent administration fee upon completion of the house and funding of each Mortgage loan.
10. (j) Blueprints. If Participant's activity is interim or residential construction, Participant must provide an original copy of the proposed blueprints to be approved by the Department prior to accepting applications. Blueprints must include the required construction requirements pursuant to Texas Government Code, §2306.514. All blueprints submitted for approval must be prepared and executed by an architect or engineer licensed by the state of Texas.
11. (k) Work Write-up. The Participant must submit a work write-up for all rehabilitation projects. Work write-ups must be reviewed and approved by the Department, before rehabilitation is started.

12. (l) Loan Program requirements. The Department may purchase or originate loans that conform to the lending parameters and the specific loan Program requirements as described in paragraphs (1) - (8) of this subsection:

    1. (1) maximum Loan amount not to exceed $45,000. If it is not possible for the Owner-Builder to purchase necessary real property and build adequate housing for $45,000, the Participant must obtain additional funding from other sources of funds.
    2. (2) minimum Loan amount is $1,000;
    3. (3) the total amount of all amortized repayable loans under the Program may not exceed $90,000. Deferred Forgivable Loans are not included in these total loan calculations;
    4. (4) may not exceed a term of thirty (30) years;
    5. (5) minimum loan term of five (5) years;
    6. (6) zero percent (0 percent) non-interest loans;
    7. (7) when refinancing a Contract for Deed, the Department will not disburse any portion of the Department's loan until the Owner-Builder receives a deed to the property;
    8. (8) Owner-Builder(s) must have resided in this state for the preceding six (6) months prior to the date of loan application.
13. (m) Loan Assumption. A Program loan is assumable if the Department determines that the Owner-Builder Applicant complies with all Program requirements in effect at the time of the assumption.
14. (n) Forgivable Loan. The term for a Forgivable Loan may not exceed 15 years from the date of closing.

Source Note:The provisions of this §24.9 adopted to be effective November 1, 2012, 37 TexReg 8496; amended to be effective November 12, 2015, 40 TexReg 7816.