Connecticut Administrative Code
Title 8 - Zoning, Planning, Housing, Economic and Community Development
219e - Hazardous Material Program
Section 8-219e-4a - Underwriting standards and criteria

Universal Citation: CT Reg of State Agencies 8-219e-4a

Current through September 9, 2024

(a) Underwriting standards for financial assistance under this program shall be based on the following:

(1) Lead-based paint: A determination by a Connecticut certified inspector that lead-based paint hazards are present in the unit, and evidence of an abatement plan approved by the local Director of Health which meets all the requirements specified in the Department of Public Health and Addiction Services (DPHAS) regulations and guidelines.

(2) Asbestos: An order for remedial action by the appropriate local official for the abatement of asbestos hazards.

(b) All abatement activities shall be performed by a Connecticut certified inspector/abater in accordance with the DPHAS regulations and guidelines.

(c) Eligible borrowers shall obtain two itemized estimates, prepared by Connecticut certified inspectors or abaters, of the cost of the abatement.

(d) The type of financing to be provided shall be underwritten according to the income of the family residing in the unit. Eligible borrowers shall qualify for financial assistance on a unit by unit basis, based on the percentage of Area Median Income, as defined by the U.S. Department of Housing and Urban Development, of the family residing in the unit to be abated.

Area Median Income

Type of Financing

Term

0 - 80%

Grant

10 years

81 - 100%

0% Loan

15 years

101 - 150%

1% Loan

15 years

151 - 200%

3% Loan

15 years

201% and up

6% Loan

15 years

(e) Persons and families with area median incomes 200% and above shall provide certification from a lending institution regulated by the laws of this state that a loan for the lead abatement and rehabilitation has been denied;

(f) In the case of multifamily structures or multiple buildings owned by one borrower, the financial assistance shall be underwritten according to the income of the family residing in each unit. The financial assistance for all units shall be blended into one contract for financial assistance.

(g) The grant amount subject to a lien shall be decreased by 10% each year, until the 10th year, whereupon the lien shall be released. If the liened property is sold prior to completion of the 10 year term, the remaining pro-rated amount of the grant or up to the amount available from the actual proceeds from such sale shall be recovered by the Department.

(h) Requirements for loans shall include but not be limited to the following:

(1) The standard loan term shall be fifteen (15) years, however a borrower may select a shorter term;

(2) All loans shall be subject to immediate repayment if the property is sold prior to the end of the loan year term;

(3) Loans shall be in a principal amount of not less than $1,000;

(4) The interest rate for loans shall be determined in accordance with Subsection (t) of Section 3-20 of the Connecticut General Statutes;

(5) Borrowers that receive 0%, 1% and/or 3% loans may select to:
1) defer the principal until the end of the maximum allowable loan term or sale of the property, whichever occurs first or

2) pay in accordance with guidelines established for borrowers of 6% loans as specified in these regulations; and

(6) Owners that receive 6% loans shall be required to pay principal and interest on a monthly basis in accordance with the loan note and established term.

(i) In cases where a borrower demonstrates that he or she does not have income sufficient to qualify or afford a loan under the standard underwriting guidelines established in this section, he or she may request application of alternate underwriting criteria.

(j) The terms and conditions for each borrower receiving financing pursuant to alternate underwriting criteria shall vary on a case-by-case basis depending on the borrower's overall financial capacity. Each borrower shall be evaluated and selected if his or her financial documentation illustrates an income to debt ratio of at least 1:3 or worse.

(k) Applicants of alternate underwriting criteria shall have various financing options available to them, including but not limited to: deferred principal payments, variable rate financing, extended loan terms, deferral of principal until sale of the property or any combination thereof.

(l) Borrowers who are owner-occupants applying for alternate underwriting criteria shall submit detailed income and debt verification.

(m) Borrowers who own rental property or properties shall submit documentation demonstrating that the income received from the rental property is insufficient to cover additional debt. Such borrowers shall also be required to submit documentation of all property income and debt, including but not limited to existing property mortgages, leases, or if no leases exist, a certified rent roll.

Disclaimer: These regulations may not be the most recent version. Connecticut may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.