The National Stabilization Program in Arizona: Mortgage Assistance Program For Foreclosed Homes

How can you buy a home in Arizona with 1% down and free money of up to 22% of the purchase price? Through a mortgage assistance program known as the National Stabilization Program (NSP), sometimes called the 1% down FHA loan.
The FHA has not changed its guidelines. They still require a 3.5% downpayment, but if you combine the FHA and NSP programs you may only be required to pay 1% upfront. Here are some highlights of the National Stabilization Program for the Phoenix area.

Eligibility for the National Stabilization Program

If you own a residence, you must be leasing your primary residence at least 12 months before applying for the program.

You must use us a lender from the ADOH participating lender list.
You must attend and complete an eight‐hour Homebuyer Education Class provided by one of the ADOH participating homebuyer counseling agencies. (A list will be provided by your lender once you begin the process.)

The property you purchase must be your primary residence.

You must have a maximum debt‐to‐income ratio of 31/43.

You must be AUS approved eligible.

You must have two months PITI reserves.

You can use any type of financing with the NSP program – including paying cash. That means you can still get up to 22% of the purchase price even if you pay cash for the house.

You must be approved and have your paperwork completed for the program prior to submitting an offer on a house.

National Stabilization Program eligible property types

Foreclosed properties only. A property is considered “foreclosed upon” at the point that the mortgage or tax foreclosure is complete.

One‐unit detached single family homes, condos and townhouse.

The property must be vacant at time of listing.

Maximum income limits in Maricopa County

Family of 1 — $55,350
Family of 2 — $63,250
Family of 3 — $71,750
Family of 4 — $79,100
Family of 5 — $85,400
Family of 6 — $91,750
Family of 7 — $98,050
Family of 8+ — $104,400

Details about the National Stabilization Program

You can get free money for up to 22 percent of the purchase price of the home.
All loans are forgivable after a period of time based on the amount of the loan.

5 years for assistance of $15,000 or less
10 years for assistance of $15,001‐$40,000
15 years for assistance of more than $40,000

All loans are zero percent interest with no monthly payment.
The balance of the loan is forgiven at the completion of the term.

The National Stabilization Program can be a great tool, along with the 8000 tax credit, for a new buyer to get into a home. It is well worth looking into while there is money for the program available and plenty of foreclosed homes on the market.