Baltimore County Settlement Expense Loan Program (SELP)

American Dream Downpayment Initiative Settlement Expense Loan Program

This program is an effort to encourage first time homebuyers to consider home ownership in existing residential communities in Baltimore County.  The program is administered by nonprofit groups and is available in designated communities.  Home Buyer's Workshops and home ownership counseling are offered to potential homeowners.  Settlement expense loans up to $10,000 are available to families whose income is at or below 80 percent of area median, adjusted for household size:

Buyer Eligibility

1. Before signing a real estate contract, completes Homebuyer Education Curriculum: Workshop(s) & Counseling with a Baltimore County affiliated Housing Counseling Agency *.
2. Meets Income Eligibility: 80 percent of area median, adjusted for household size.
3. First time home buyer (cannot have previously owned a dwelling within the last 3 years). Exceptions can be granted for separation, divorce or death of spouse or prior ownership of documented substandard hous
4. Qualifies for a fixed rate mortgage with a Participating Lender. (See the Referral List )
5. Post purchase liquid assets cannot exceed 12 percent of gross annual household income.
6. Gift Contributions may not exceed 3 percent of the sales price.
7. Buyer's proposed post purchase housing and total debt ratios cannot exceed 29 percent and 41 percent, respectively, of the gross monthly household income. 
8. Has cash equal to 5 percent of gross household income to contribute to purchase (see below).

Property Criteria

1. Existing dwelling that is owner occupied, occupied by buyer, or vacant.  New construction is excluded.
2. Dwelling types: Single family detached, semi- detached, townhouse, and condominium unit.
3. Located within the mapped Community Conservation Area.  This is generally described as the inner ring of suburban communities, but excludes the growth areas of White Marsh and Owings Mills, and the rural areas.   Please see SELP Program Boundaries maps.
4. Has had a satisfactory home inspection and has been certified as meeting the federal Housing Quality Standards (HQS) using an inspection firm from the County's pre-qualified list.  The HQS certification provides assurance to the County that the dwelling is free from hazardous defects and meets basic standards for safety and livability.  All noted deficiencies must be corrected and verified prior to SELP Loan approval.  The home inspection and HQS certification fee can be included as part of the buyer's minimum cash contribution.
5. The cost of repairs required to correct HQS identified deficiencies may be Included in the borrowers maximum loan amount up to $2,500.00 when such repairs are done by a licensed contractor.

SELP Loan Terms

1. SELP Loan Amount: Minimum $1,000, Maximum $10,000.
2. Buyer's minimum cash contribution: 5 percent of gross annual household income.
3. SELP Loan - Loan is deferred for fifteen (15) years (Affordability Period ). Thereafter, the loan is forgiven after 15 years, unless sale, transfer of title or default occurs before the end of the (Affordability Period) 15 years.
4. Primary Loan - Loan principal is repayable upon the earlier to occur of sale, transfer, refinance, default on primary loan, or discontinuance of borrower occupancy in the home.

Note: Official SELP PROGRAM GUIDELINES & PROCEDURES adopted by the Baltimore County Office of Community Conservation take precedence and clarify the details of the information presented here.Equal Housing Lender.

Revised July 5, 2006