Mortgage Guarantee

The Mortgage Guarantee program is designed to increase the number of employee-owned and occupied residences within our neighborhood by making purchasing a home more affordable. Usually, when a bank lends more than 80% of the value of a house, they require private mortgage insurance (PMI) to guarantee repayment of the loan. The bank buys the insurance for you and includes the insurance premium in your monthly payment. PMI can cost $50 or more per month. Through special arrangements with Fulton Bank, the College will act as your private mortgage insurance, so you don’t have to pay the premium. Below are the parameters of the Mortgage Guarantee program:

Parameters:

• For the City Life loan, the maximum purchase price is $200,000 (or the prevailing conforming loan amount or the bank's appraised value, whichever is less.)  For the Keystone Home Loan, the maximum purchase price is also $200,000.

• One or two family dwellings only. Condominiums must be Fannie Mae approved.

• Within the established area east of the College bordered by College Avenue, Orange Street, Arch Street and Harrisburg Pike as indicated on the attached map.

• May borrow up to 97% of the purchase price of the home.  (Revised October 2008)

• Applies to loans with Fulton Bank only.

• Must meet all the normal lending criteria required by the lender.

• The lender determines the interest rate. To obtain current rates, please telephone the lender directly at (717) 291-2873.

• Home must be and remain your principal residence.

• For any mortgage obtained under this program, the College’s guarantee will be revoked if:

  • the mortgagor ceases to be an employee of the College

  • the employee ceases to occupy the property as his/her principal residence

  • the employee ceases to be the owner of the property

• Significant changes in employment status, like switching to part-time, a leave of absence or retiring, will trigger a review of the participant’s continued eligibility for the guarantee.

• If the College's guarantee is revoked, the employee must obtain their own private mortgage insurance (PMI), which will require refinancing the loan, by contacting the bank directly at (717) 291-2873.

The College’s program is offered to eligible credit-worthy employees under an arrangement with the lender. An applicant for a bank loan under the program will be subject to credit verification and must satisfy the lender with regard to the ability to repay the loan based upon the lender’s criteria. The decision to grant the bank loan rests solely with the lender.

If you cease to be an employee of the College, cease to occupy the home as your principal residence, or cease to own the home, it is your responsibility to notify the College's Investment Office at citylife@fandm.edu and Fulton Bank immediately.

Eligibility:

• Faculty and professional staff appointed to full-time positions, as well as part-time employees appointed to positions pre-authorized by the College to work 1,000 hours or more per year, are eligible to participate in the City Life Program.  The following are not eligible to participate in the City Life Program: (a) faculty and professional staff appointed on a fixed-term temporary, or seasonal basis, including full-time visiting faculty, (b) adjunct faculty, and (c) part-time employees not authorized by the College to work 1,000 hours or more per year.

• Employment in good standing

• 21 years of age or older

• United States citizen, permanent resident alien, or H-1B visa holder

• If there is more than one employee in the household, the program will apply only once.

  Note:  Not available to employees who already own a home and reside in the established area.  Not available to employees who participated in the College’s Home Buyer Incentive Program.

Procedure:

• Prior to beginning your search for a home, we will verify your eligibility for the program. Send an e-mail to citylife@fandm.edu requesting a review of your eligibility. We’ll respond to you and Fulton Bank.

• Prior to beginning your search for a home, speak with a lender to determine the amount you’ll be eligible to borrow. Call Fulton Bank at (717) 291-2873.

• Interview several Realtors, check references and select a Realtor to assist you with your house hunt.

• First-time home buyers must complete the workshop offered by the Lancaster Housing Opportunity Partnership (LHOP). To register for the workshop, visit their website at www.lancasterhousing.org.

• Before you make an offer on a specific home, send an e-mail to citylife@fandm.edu requesting verification that the home qualifies for the program. We’ll respond to you and Fulton Bank.

• Prior to signing an Agreement of Sale, we strongly recommended that you secure the services of an attorney knowledgeable in real estate matters.

• Once you and the Seller have an executed Agreement of Sale, send a copy of the signed Agreement to the Investment Office located in the Race Avenue building (RAC.)

• Contact the lender to complete the loan application process.

• The College will obtain verification directly from the lender when your loan has been approved. The lender will also provide us with the settlement date.

• We will contact you to schedule a pre-settlement conference with Kathy Fish in the Investment Office.

• Prior to settlement, the College will confirm your eligibility again and forward the College’s Neighborhood Housing Program Agreement to the lender for your signature at settlement. The signed Agreement will be returned to the College by the lender.

This information is intended only as a general review of the College's programs. Your bank loan will be governed by the detailed terms and conditions of the mortgage loan documents, including the note and mortgage, and the College's Neighborhood Housing Program Agreement. Should there be any inconsistency between this program's description and those documents, the terms and conditions of the note, mortgage and Neighborhood Housing Program Agreement shall govern.

This information is intended as a general overview only. The terms, conditions and procedures of the City Life programs are subject to change at the College’s discretion. We strongly urge you to seek the advice of knowledgeable legal counsel when contemplating a real estate purchase.