The Richland County Homeownership Assistance Program (RCHAP) is a gap financing program, meaning it serves as the funding source of last resort. Applicants are required to utilize available personal assets before receiving assistance. If your savings account balance exceeds $20,000, the amount above that threshold will be required to be applied toward the down payment and/or closing costs before RCHAP funds can be provided.
In Part I of the underwriting process, we use the estimates listed below to determine an approximate home purchase price that is affordable based on your financial qualifications. You may choose to purchase a property above this estimated purchase price; however, the monthly mortgage payment must still meet program affordability requirements.
If you decide to purchase a home that exceeds the estimated affordable purchase price, you may be required to contribute additional funds toward the transaction to ensure the property remains affordable. Richland County requires homebuyers to contribute a minimum of $500 toward the purchase of their home. This contribution may be applied toward the down payment, closing costs, or principal reduction.
The $500 contribution requirement may be waived if you provide documentation showing that you have already paid eligible homebuying expenses, such as earnest money deposits or housing counseling fees.
Note: During the underwriting process only the income for the purchaser will be used to determine what is affordable.
Phase I: Pre-Qualifications
Only the income of the buyer (or buyers, if applicable) will be used to assess mortgage affordability.
Affordability Ratios
A front-end ratio of 33% and a back-end ratio of 45% will be applied to determine the buyer’s maximum allowable monthly housing expense.
Monthly Payment Calculation
The estimated maximum monthly payment will include:
Buyer’s minimum contribution: $500
Estimated property taxes: $1,600/year
Estimated homeowners’ insurance: $1,200/year
Estimated Homeowners Association fees (HOA): $900/year
Estimated interest rate: The rates will come from Fannie Mae website
***All household income will be used to determine program eligibility. However, for underwriting purposes, only the income of the applicant listed on the loan will be used to determine affordability. If child support is expected for less than three years, it will not be included in the underwriting calculation.
Once the application is submitted with all the required paperwork, the application process takes up to 30 business days. Please note the application approval time when considering your home-buying process.
All applicants will receive written notification either a denial or eligibility letter once the application review process is complete.
Phase II: Contract Submission and Commitment
The lender will provide Richland County with a Loan Estimate for review. We will verify the amount of down payment assistance, closing cost assistance, and any principal reduction needed to complete the purchase.
The information provided by the lender will be reviewed to ensure the home remains affordable and meets all program requirements. The homebuyer's debt-to-income ratio must remain within program guidelines and cannot increase beyond the approved underwriting limits.
Document Collection
The buyer’s Lender and Realtor will submit the following documentation:
- Final sale price
- Actual interest rate
- Principal, Interest, Taxes, Insurance, and HOA dues
- Loan Estimate
Affordability Review
Using the actual figures provided by lender, staff will verify that:
The final monthly mortgage payment does not exceed the buyer’s approved limit.
The final sale price aligns with the eligibility letter.
Buyer will need to provide current bank statement with savings of three (3) months mortgage.
Commitment Letter
A Commitment Letter will be issued outline the final assistance amount awarded to the borrower and the next steps requirements
Phase III Final Disclosure
The Lender will submit the Final Disclosure documents for review.
Verification of Final Figures
All final financial details will be reviewed to confirm continued compliance with underwriting thresholds and program requirements.
Approval and Closing
Upon final approval, authorization will be issued to proceed with closing.
Schedule a time for the homebuyer to come in and sign the Written Agreement.
If at any time your lender, real estate agent, or closing attorney changes during the homebuying process, you must notify our department immediately. Failure to provide updated contact information may result in delays in the review and approval process.
No funds may be disbursed directly to the homebuyer at closing. If any funds remain after all eligible down payment, closing cost, and principal reduction expenses have been paid, the unused funds must be returned to Richland County.