Affordable Homeownership Technical Assistance Toolkit
Stewardship Principles
Comprehensive Program Assessment
Module 1: Program and Business Planning
Module 2: Affordable Pricing
Module 3: Mortgage Financing of Resale-Restricted Homes
Module 4: Marketing and Selection of Affordable Homes
Module 5: Resale Formulas, Sales and Resales of Resale-Restricted Homes
Module 6: Support, Monitoring and Enforcement
 Decision Guide
Assessment Tool
Technical Assistance Tool Pack
Module 7: Home Repair and Replacement Reserve Funds
The Cornerstone Partnership provides a peer network for homeownership programs that preserve
long-term affordability and community stability, helping more hard-working people buy homes
today, maintain those homes and keep them affordable in the future. The Cornerstone Partnership
is a program of NCB Capital Impact funded by the Ford Foundation.
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www.affordableownership.org
MODULE 6: Monitoring, Support & Enforcement
Decision Guide
Stewardship Principles
We strive to scale the affordable homeownership industry through partnerships at local and regional
levels and across sectors, bringing together organizations and jurisdictions around common stewardship
principles.
A public or nonprofit agency should design its program to espouse these principles which are intended to
guide the implementation of programs that invest public or philanthropic resources to reduce the cost of
homeownership and seek to preserve this public investment for maximum impact. The principles fall into
six categories as listed below – the full list of principles is available at www.affordableownership.org.
Impact-Driven - Set and track goals that reflect community priorities.
Balanced - Build wealth for owners while preserving the community interest.
Targeted - Focus on buyers who need help but are likely to succeed.
Managed - Steward the public investment to ensure long-term community benefit.
Safe - Ensure sound mortgage financing.
Understandable - Educate buyers on program requirements.
This Decision Guide is meant to be used by a consultant to augment the technical assistance plan resulting
from the associated Module Assessment and to inform discussions about best practices. If the program is
new and/or has not undergone a Module Assessment, this Decision Guide can be used to help the
consultant and program administrator think through questions and policy issues critical to a successful
affordable homeownership program. The consultant can draft a final report based on the results from
this Decision Guide.
Copyright 2010 NCB Capital Impact
This toolkit has been developed by NCB Capital Impact based in part on works developed
by the National Community Land Trust Network. It is licensed under a Creative Commons
Attribution-Share Alike 3.0 United States License. Please see back page for full licensing
information.
NCB Capital Impact uses its depth of experience, cooperative approach, and diverse network of
alliances to generate critical investments that create a high quality of life for low income
people and communities. For more information about NCB Capital Impact, go to
www.ncbcapitalimpact.org.
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
Monitoring, Support & Enforcement
This Decision Guide identifies key issues and raises essential questions for post-purchase support,
monitoring and enforcement in an affordable homeownership program. Such monitoring and
enforcement works within the relationship the program has built with the homeowner after his/her
purchase of a resale restricted home.
Each section lists relevant sample documents, worksheets and other useful tools that can be found in the
Tool Pack for this Guide.
TABLE OF CONTENTS:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
General
Use Restrictions
Owner Occupancy
Renting
Additional Liens
Payment of Taxes
Payment of Home Loan(s)
Payment of Insurance
Payment of Monthly Program Administration Fees
Payment of Homeowner’s Association Dues
Refinancing
Condition of the Home
Improvements to the Home
Support, Monitoring and Enforcement TA Tool Pack

Sample Monitoring Procedures

Sample Annual Letter

Sample Post-Purchase Support Activities

Sample Enforcement Plan

Sample Owner Occupancy Certification

Sample Exceptions Request Policy and Form

Sample Leave of Absence Form

Sample Procedure to Add or Remove a Name in the Homeowner Regulatory Document

Sample Leasing Policy

Sample Administrative Fee Policy

Template Initial Conditions Document Checklist

Sample Document Retention Policy

Sample Maintenance Policy

Sample Improvements Policy
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
1 General
This section deals broadly with ways to support and sustain a positive relationship with homeowners that
will help avoid noncompliance issues and make monitoring and enforcement easier.
POLICY ISSUES
1.1
CONSIDERATIONS
How does the program
communicate with
homeowners to help
minimize
noncompliance issues?

How often do we communicate with our homeowners?

What type of communication do we use?
o
Informal – newsletter with homeowner resources or
home maintenance tips
o
Formal – an annual letter restating homeowner
requirements
o
Both
Any communication with should reinforce and further other
program goals, as well as remind homeowners of program
requirements (e.g., encouraging home maintenance, providing
continuing homeownership education, building community, etc.).
1.2 What level of ongoing
support, if any, does the
program provide for
homeowners?

What other types of support do we offer?
o
Financial education
o
Assistance with setting up neighborhood watch
programs
o
Tax preparation assistance, information, referrals
o
Other ___________________________________
Monitoring includes both periodic certification of program compliance – typically through submittal of
paper documentation – and physical monitoring via site visits. Programs monitor compliance in order to
ensure that they protect affordability, preserve the structural integrity of the homes they assist, prevent
the loss of those homes to foreclosure, and retain public credibility for the program.
POLICY ISSUES
1.3 Does the program do
periodic certification to
monitor homeowner
compliance?
CORNERSTONE PARTNERSHIP
CONSIDERATIONS

What documentation do we ask for?
o
Certification of owner-occupancy
o
Proof of payment of property taxes
o
Proof of payment of home loan (e.g., copy of year-end
loan statement from homeowner; quarterly statement
from loan servicer showing loan status)
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
1.4 What other agencies
monitor homeowners
or neighborhoods
regularly (e.g., agencies
that deal with municipal
nuisance ordinances)
and can the program
rely on their monitoring
schedule in any way?
1.5
If the program
discovers evidence of
noncompliance, what
does it do?
o
Proof of payment of homeowner insurance (e.g., copy of
receipt or cancelled check)
o
Proof of payment of HOA dues (e.g., copy of monthly
financial statement from HOA; copy of cancelled check
showing paid dues or receipt from HOA if one is
provided)

How often do we require such certification?

How cumbersome is it for the homeowner to provide the
information and how cumbersome is it for us to review?

Do we have a process for selecting and entering into
strategic partnerships?

What are the action steps in our Enforcement Plan?

Under what circumstances do we take the following steps?

o
Engage enforcement authorities (e.g., Police
Department, Sheriff, Health Department, Building
Department, Planning and Zoning, etc.)
o
Force compliance and/or try to compel a resale
o
Foreclose our loan
o
Terminate the homeowner’s right of ownership in our
program
Who provides specialized legal counsel to our program under
these circumstances?
Performance standards, the right to charge damages/fees, and the right
to terminate ownership will vary from state to state and from program
to program.
The program should identify the time frame for correcting
noncompliance issues and specify any monetary charges it would levy.
The program should work with its lawyer to draw up a plan for how it
will enforce its rights and restrictions under the Homebuyer Regulatory
Agreement, and how it will ensure that the methods it chooses for
enforcement (e.g., fines) are allowable within state law.
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
Furthermore, the program may want to identify whether there are nonpunitive responses (or up-front incentives) that it can employ to help
prevent noncompliance.
1.7 How often does the
program complete a
paper audit of program
files to ensure that its
records are complete?

What records do we retain?
o
The documents listed in the Initial Conditions Documents
Checklist
o
Any Exceptions/Waivers granted by the Program
Administrator
o
Periodic certification documents
o
Other
The program should do a regularly scheduled internal audit of its files to
ensure they are complete.
An affordable homeownership program must track detailed information
for each home it subsidizes. This includes – but is not limited to – upkeep,
alterations, use, occupancy, financing, resale, subsidy source and
restrictions, and subsidy amount invested. Some programs use simple
spreadsheet programs to track this type of information, while others use
more complex database tools.
Related Tool Pack Documents:




Sample Monitoring Procedures
Sample Annual Letter
Sample Post-Purchase Support Activities
Sample Enforcement Plan
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
2 Use Restrictions
It is easier to remind homeowners of use restrictions than to enforce them. Enforcement, if it gets to that
point, is likely to require a significant commitment of human resources.
POLICY ISSUES
CONSIDERATIONS
2.1 Is the program’s
monitoring largely
neighbor-complaintdriven?

Do we have a process for responding to neighbor
complaints?

Do we have a more active way to monitor use compliance?
2.2 Does the program
intervene if there are
illegal activities at the
home? If so, what
actions is it prepared
to take?

Under what circumstances do we take the following steps?
o
Engage enforcement authorities (e.g., Police
Department, Sheriff, Health Department, Building
Department, Planning and Zoning, etc.)
o
Try to compel a resale
o
Foreclose our loan
o
Terminate the homeowner’s right of ownership in our
program
Related Tool Pack Documents:


Sample Monitoring Procedures
Sample Enforcement Plan
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
3 Owner Occupancy
Affordable homeownership programs require owner occupancy, and need to make sure that
homeowners abide by that requirement. If they allow deviations from the owner occupancy requirement,
they need to specify under what conditions deviations are allowed. Because the program’s reputation
and success may be at stake, they also need to be prepared to step in if they discover evidence of
noncompliance.
POLICY ISSUES
CONSIDERATIONS
3.1. What certification
documentation does the
program require to
verify occupancy?
3.2. Is there a trigger that
moves the program’s
action from a paper
audit to a physical site
visit?


What types of documentation do we collect?
o
Copy of mobile telephone bill
o
Copy of utility bill
o
Copy of tax bill
o
Proof of payment (such as cancelled check or bank
statement) showing address
What triggers our need to move from a paper audit to a
physical site visit?
o
Mail is returned-to-sender
o
Homeowner communication shows a different return
address from the program home
o
Occupancy certification is not returned
Paper audits can be carried out by administrative staff. Site visits require
a greater commitment of human resources.
3.3 Does the program allow
deviations from the
residency requirement,
and if so, under what
conditions? For how
long?

How do we accommodate real life circumstances that
require a deviation from the residency requirement?

Do we permit the homeowner to take a leave of absence
from the home?

During that time, do we permit the homeowner to lease or
sublease the home?

3.4 If the program discovers
noncompliance, what
does it do?
CORNERSTONE PARTNERSHIP

Do we notify the homeowner of the noncompliance, and
provide a time frame for correcting the deficiency?

How do we notify the homeowner?

If the homeowner fails to correct the noncompliance, what
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
is our course of action to enforce our rights?
Related Tool Pack Documents:




Sample Owner Occupancy Certification
Sample Exceptions Request Policy and Form
Sample Leave of Absence Form
Sample Procedure to Add or Remove a Name in the Homeowner Regulatory Document
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
4 Renting
Affordable homeownership programs are just that: homeownership. Such programs need to be prepared
with a policy position and associated implementation procedures in the event that a homeowner wishes
to rent all or a portion of the home, particularly if the program permits deviations from the occupancy
requirement under specified circumstances.
POLICY ISSUES
CONSIDERATIONS
4.1 Does the program
allow the homeowner
to rent?

Do we allow homeowners to rent part or all of their home?

How much do we allow homeowners to charge?
4.2 Do renters need to
meet program
eligibility criteria?

Do we require renters to be in compliance with the other
terms of the Homebuyer Regulatory Agreement?
4.3 Does the program
place a limit on the
rental term?

How does the rental term relate to our owner-occupancy
requirement?
4.4 Does the program
require an addendum
to the Homebuyer
Regulatory
Agreement for
renters?

How do we address property damage by a renter?
4.5 Does the program
require the
homeowner to submit
a copy of the lease?

Are there specific protections or stipulations that we want
such a lease to include?
4.6 Does the program
intend to intervene if
the homeowner has
illegally sublet the
home? If so, what
actions is the program
prepared to take?

Under what circumstances do we take the following
actions?
CORNERSTONE PARTNERSHIP

o
Evict the renter
o
Pay an innocent tenant’s relocation costs
o
Charge the homeowner a fine
If monitoring leads to enforcement, and requires a
significant commitment of human resources, do we have
the capacity to enforce compliance?
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
Related Tool Pack Documents:

Sample Leasing Policy
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
5 Additional Liens
Affordable homeownership programs must be careful about the types and levels of financial
encumbrances they permit on the homes they have subsidized, because they risk their subsidies in deals
that fail.
POLICY ISSUES
CONSIDERATIONS
5.1 How does the
program ensure that
no additional liens are
placed on the home
that would prevent
title from being
transferred free and
clear at resale?

Do we review title reports for additional liens? How often?

Do we have the resources to order and review title reports?
If the Program Administrator discovers illegal liens, the program
may require that those liens be immediately satisfied in order that the
homeowner not be in default of the program restrictions.
Title report review requires a commitment of human resources
commensurate with the size of the program’s portfolio of assisted
homes.
Related Tool Pack Documents:


Sample Monitoring Procedures
Sample Enforcement Plan
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
6 Payment of Taxes
Because a program has a long-term, non-possessory interest, its investment is at risk if the homeowner
fails to pay taxes owed. The program therefore must ensure that taxes are paid, and decide whether and
how it will step in if they are not.
POLICY DECISION
CONSIDERATIONS
6.1 Does the program
collect taxes due from
the homeowner and
pay them as a passthrough to the tax
collector?

Can we absorb the additional administrative burden this
creates?

Do our lenders already require a tax impound account?
6.2 As part of its paper
monitoring/program
certification, does the
program require that
homeowners provide
evidence of their tax
payment?

Do we require a copy of a homeowner’s tax payment?

Is this information available online or can we make
arrangements with the assessor to receive a copy?
6.3 If the program
discovers the
homeowner owes
taxes, what does it do?

What enforcement options are best for us?
o
Contact the homeowner to correct the problem
o
Pay the taxes owed and try to collect the funds from the
homeowner through a fee
o
Pay the taxes owed and place a lien on the home for the
amount we paid on the owner’s behalf
Related Tool Pack Documents:


Sample Monitoring Procedures
Sample Enforcement Plan
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
7 Payment of Home Loan(s)
In the same way that the program has exposure regarding taxes and illegal liens, its investment is at risk if
the homeowner fails to make his or her loan payments.
POLICY ISSUES
CONSIDERATIONS
7.1 How does the program
know if loan payments
are late, but not yet in
default?

Do we request that the loan servicer notify us of late
payments?

How often does our staff check loan status with the servicer?

Do we review credit reports for late and missed payments?
7.2 How does the program
 How do we know that the loan servicer will notify us of a loan
ensure that the loan
in default?
servicer understands

the program and the
lender’s obligation to
notify the program in
case of default?
It is important to remember that a loan servicer is often a different
entity from the loan originator, particularly if the loan has been sold.
Many programs require that homeowners sign a Third Party Notification
Release at the time of purchase. This gives permission for the Program
Administrator to communicate with the lender concerning the loan and
requires the lender to notify the Program Administrator in the event of a
default.
In addition, programs can also require that homeowners provide the
Program Administrator with a copy of their year-end loan statement
showing year-to-date principal and interest payments.
7.3 Does the Program
Administrator
communicate with the
loan servicer
concerning the status
of the loan for each
assisted home?

How many assisted homes do we monitor?

Do we have more than one lender and/or more than one
servicer?

How often do we communicate with loan servicers?
7.4 Does the program
communicate with
homeowners regarding
bank payments?

How many assisted homes do we monitor?

How often do we communicate with homeowners regarding
loan payments?
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
Without proactive monitoring, and an ongoing communicative
relationship with the loan servicer, the homeowner may be in arrears
two or three months before the program receives a notice of default.

7.5 If the program
discovers a homeowner
is in arrears, what does
it do?
7.6 How does the program
minimize the risk of
foreclosure?
What are our enforcement options if we discover that a
homeowner is in arrears?
o
Work with the homeowner to bring the loan payments
current
o
Work with the loan servicer to see if a workout plan is
possible
o
Make a payment on behalf of the homeowner and place
a lien on the home for the amount the program has paid
o
Work with the homeowner to re-sell the home to an
eligible buyer

Do we have resources for foreclosure prevention?

Are there other organizations with which we partner for
foreclosure prevention?


7.7 What does the program
do in the event that it
has failed to prevent
foreclosure?
Do we have access to specialized legal counsel to help us
explore our options and to work through foreclosure
proceedings if necessary?

Related Tool Pack Documents:


Sample Monitoring Procedures
Sample Enforcement Plan
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
8 Payment of Insurance
Like most of the content covered in this Decision Guide, the subject of insurance is about program
exposure and liability. The program must make sure that the homeowner is covered for liability claims
(and potentially that the program is named as an additional insured), and that the coverage is sufficient.
The bottom line is that the program does not want to risk losing a home back to the open market – in this
case, due to an insurance claim.
POLICY ISSUES
CONSIDERATIONS
8.1 Does the program
establish minimum
insurance limits for
insurance coverage and
state those explicitly in
the Homebuyer
Regulatory Agreement?

Do we set minimum insurance limits?

How do we know what limits to set?

Do we defer to the requirements of the lender?
Having insurance limits ensures adequate insurance coverage to protect
program investments.
Monitoring compliance to insurance limits creates an administrative
burden for the program.
8.2 How does the program
monitor continuity or
sufficiency of insurance
coverage?
8.3 If the program
discovers that
insurance coverage has
lapsed or is inadequate,
what does it do?
CORNERSTONE PARTNERSHIP

Do we require that homeowners provide us with a copy of
their receipt or cancelled check for payment of insurance
premiums?

Do we require owners to provide us with a copy of their
policy coverage?

Do we require that we be listed as additionally insured, which
means direct notification from the insurance company?

What are our enforcement options if we discover that
insurance coverage has lapsed?
o
Contact the homeowner to correct the problem
o
Contact the loan servicer to correct the problem (if
premiums are paid through escrow)
o
Pay the insurance owed and try to collect the funds from
the homeowner through a fee
o
Pay the funds owed and place a lien on the home for the
amount we paid on the owner’s behalf
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
Related Tool Pack Documents:


Sample Monitoring Procedures
Sample Enforcement Plan
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
9 Payment of Monthly Program Administration Fees
Some affordable homeownership programs charge each subsidized homeowner a monthly administrative
fee to offset program costs. Programs may rely on this fee as the basis for an ongoing relationship with
the homeowner – in a support capacity to remind homeowners that the program continues to be
involved in the homeownership experience and in a monitoring capacity as nonpayment of the fee can
indicate a financial problem. In order to cement the gravity of the program’s role as subsidy provider, the
program might select various ways to ensure its monthly fee is paid in full and on time.
POLICY ISSUES
CONSIDERATIONS
9.1 Does the program
charge an
administrative fee?

Do we charge an administrative fee?

Do we have the staff and system capacity to track a fee?
9.2 Does the program have
an incentive for early
payment of the
administrative fee?

What kind of incentive do we offer for early payment?

Do we have the administrative capacity given that certain
incentives could create an administrative burden for us
(internal tracking system)?
9.3 Does the program
impose a fee for late
administrative
payments?

What constitute s late payment of our monthly administrative
fee?

Do we have a fee for late payment?

How much do we charge?

At what point do we charge?

Do we have the administrative capacity given that imposing a
fee creates an administrative burden for us (internal tracking
system)?
For programs that charge an administrative fee, the fee can function as a
proverbial canary in a coal mine, providing some forewarning of financial
difficulties if a homeowner gets behind in his/her administrative fee
payments.
Imposing a late fee increases financial burden for homeowners who are
already struggling to make payments.
9.4 At what point does the
program consider the
homeowner to be in
default?
CORNERSTONE PARTNERSHIP

When do we consider a homeowner to be in default?

Do we notify homeowners that they are in danger of being
held in default?
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
9.5 If a homeowner fails to
pay his/her
administrative fee,
what does the program
do?
9.6 At what point does the
Program Administrator
send a letter of default
to the homeowner and
to the lender?

What are our enforcement options if a homeowner fails to
pay the administrative fee?
o
Place a lien on the home for the administrative fees
owed
o
Communicate with the homeowner about a possible
resale of the home
o
Initiate foreclosure proceedings

Do we notify the lender of homeowner default on
administrative fees?

Is the lender likely to accelerate its loan if we notify the lender
of a default?
Related Tool Pack Documents:

Sample Administrative Fee Policy
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
10 Payment of Homeowner’s Association Dues
The program may or may not want to be involved in the homeowner’s relationship with his/her
homeowner’s association, if the home is a condominium. This section addresses some of the issues
inherent in the program’s status as an outside (but interested) party to that relationship.
POLICY ISSUES
CONSIDERATIONS

10.1 Does the program
monitor HOA
payments?
What is the goal of our monitoring HOA payments – to
protect the homeowner from unfair charges or to ensure the
homeowner is staying current with paying HOA dues?
Some programs do not monitor HOA dues, and do not consider
themselves party to any negotiations concerning HOA dues levels or
payments (e.g., City of Denver Affordable Homeownership Program).
Some programs consider this a relationship between the homeowner
and the Homeowner’s Association, not between the homeowner and the
program. Therefore, privacy issues come into play.
If the program wants to monitor HOA dues, it can request a copy of the
monthly account statements from the HOA, if sufficient detail is
provided. The program can also request a copy of the cancelled check or
a receipt from HOA showing dues have been paid.

10.1 If the program learns
that HOA dues are in
arrears, what does it
do?
Do we get involved in negotiating an HOA payment or stay
out of the relationship?
Related Tool Pack Documents:


Sample Monitoring Procedures
Sample Enforcement Plan
CORNERSTONE PARTNERSHIP
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
11 Refinancing
If the program permits refinancing, it needs to ensure that homeowners do not refinance their homes
outside of its allowed policies and procedures. In addition, it needs an enforcement plan if they do
refinance against policies and procedures.
POLICY ISSUES
CONSIDERATIONS
11.1 How, and how often,
does the program
monitor home
refinancing?

What is the number of homes we are trying to monitor in this
fashion?

Can we handle the added administrative burden?

Is a local title company willing to pull title reports gratis?
Proud Ground, in Portland, Oregon, works with a title company to pull
and review a title report for each land trust property every year.

11.2 If the program
discovers unpermitted
refinancing, what does
it do?
What are our enforcement options if we discover
unpermitted refinancing?
o
Require the homeowner to refinance again, in
accordance with our policies
o
Require that the subsidy be repaid
The resale formula would still be in effect after refinancing. If the
homeowner needs to re-sell before he/she has built sufficient equity in
the home, he/she might need to bring cash to closing.
Some programs (e.g., Lawrence Community Housing Trust) that use a
deed covenant as the Homebuyer Regulatory Agreement hold a second
mortgage for the value of their subsidy. This may be helpful in program
enforcement because the program can call its note in the case of
unpermitted refinancing.
Related Tool Pack Documents:


Sample Monitoring Procedures
Sample Enforcement Plan
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
12 Condition of the Home
The program has pledged to ensure its subsidized homes remain affordable over the long term. The
program’s monitoring needs to ensure that protection of affordability goes hand-in-glove with
preservation of each home’s structural integrity.
POLICY ISSUES
CONSIDERATIONS
12.1 Does the program
monitor the home itself
via a drive-by or site
visit? If so, how often?

12.2 What goals does the
program have for the
homes it has assisted, in
terms of preservation
and upkeep?

How do we support our program goals for preservation and
upkeep?

Do we provide any supporting information about
maintenance (e.g., proactive communications regarding
home maintenance)?

Do we provide any financial support for home maintenance?
Are there triggers that move us from a paper audit to an onsite inspection?

What privacy issues are at stake? What rights do
homeowners have?
Most programs and organizations aren’t doing physical inspections
under any circumstances for practical reasons – limited staff resources,
scattered sites, etc. However, it may be valuable for the program to
consider circumstances under which a site visit would make sense. For
example, the following situations might trigger a site inspection:
 Receipt of homeowner’s Notice of Intent to Sell
 Notification of unusual or illegal activity at the home
 Notice that the homeowner is refinancing Notice of default
from the lender
 Paper audit identifies potential lack of compliance with
residency requirement
Site monitoring requires a significant commitment of staff time.
12.3 How does the program
 What documentation do we need if we are required to
establish a baseline for
defend our restrictions in court?
the initial condition of
an assisted home?
Complete documentation as to the home’s initial condition is important
under the following circumstances:
 If a program wishes to compel a homeowner to address
deferred maintenance needs, it needs to be able to
demonstrate the condition of the home at initial purchase and
prove that it has not been properly maintained.

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If a program’s resale restriction provides any form of credit for
capital improvements or home maintenance, it should retain on
file the initial inspection report and the appraisal, with
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
photographs of the home.
12.4 What does the program
do if its efforts do not
work and there is
deferred maintenance?

Do we provide any financial support for maintenance
expenses? If so, is it in the form of grants or loans?

What are our enforcement options?
o
Let the market correct for poor condition (e.g., home
returns less value to the seller at resale, if it is an
appraisal- based formula or if there are deductions for
poor condition)
o
Rely upon lender requirements (e.g. the home cannot be
financed by the buyer unless certain components are
fixed) (Do we then dictate who pays for repairs/deferred
maintenance or let the buyer and seller negotiate?)
Related Tool Pack Documents:



Template Initial Conditions Document Checklist
Sample Document Retention Policy
Sample Maintenance Policy
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
13 Improvements to the Home
It is natural for homeowners to want to personalize their homes. This may entail some simple alteration
like changing the paint colors or an improvement far more dramatic like finishing the attic into living
space or building an addition. The program must clarify its policies on alterations and home
improvements and be prepared to track the details. It is particularly critical if the resale formula includes
an improvements credit.
POLICY ISSUES
CONSIDERATIONS

How do we define improvements?

What are our limits on improvements?

Do we track the cost or value of improvements?

Do improvements need to be approved by our program – if
so, which ones?
13.2 How does the program
ensure that the home
remains affordable to
future eligible buyers?

Do we track the cost or value of alterations?

Do we set an affordability cap?

How do we keep the administration simple?
13.3 How does the program
ensure that
homeowners are
capable of financing
and completing any
proposed
improvements?

Do we establish a means test? If so, how?

What do we do if a homeowner is ultimately unable to
complete an improvement project on his or her home?
13.4 Does the program track
home improvements
for the purpose of
determining the resale
price?

Do we require copies of records, plans, building permits or
certificates of completion?

Do we require copies of estimates or receipts?
13.1 Does the program
impose limits on
improvements?
Related Tool Pack Documents:

Sample Improvements Policy
This completes the Decision Guide for Module 6: Support, Monitoring and Enforcement.
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MODULE 6: Monitoring, Support & Enforcement
Decision Guide
Licensing Information
Copyright 2010 NCB Capital Impact
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