10 TAC §§2.1 - 2.4
The Texas Department of Housing and Community Affairs (the
Department) proposes new §§2.1-2.4, concerning the Owner-Builder
Loan Program. The purpose of these sections is to provide hearing establish
the requirements of this program pursuant to Subchapter FF of Chapter 2306,
Texas Government Code.
Ms. Edwina P. Carrington, Executive Director, has determined that for the
first five-year period the proposed sections are in effect there will be no
fiscal implications for state or local government as a result of enforcing
or administering the rules.
Ms. Carrington also has determined that for each year of the first five
years the proposed sections are in effect, the public benefit anticipated
as a result of enforcing these sections will be will be more affordable housing
for the State of Texas. There will be no effect on persons, small businesses
or micro-businesses. There are no anticipated economic costs to persons, small
businesses or micro-businesses who are required to comply with these sections
as proposed. The proposed new sections will not have an impact on any local
economy.
Comments may be submitted to Anne O. Paddock, Deputy General Counsel, Texas
Department of Housing and Community Affairs, P.O. Box 13941, Austin, Texas,
78711-3941 or by email at the following address: apaddock@tdhca.state.tx.us.
The new sections are proposed pursuant to the authority of the
Texas Government Code, Chapter 2306.
The new sections affect no other code, article or statute.
§2.1.General Provisions.
(a)
Purpose. The purpose of this subchapter is to establish
the requirements governing the Owner-Builder Loan Program created pursuant
to Subchapter FF of Chapter 2306, Texas Government Code.
(b)
Definitions and abbreviations. The following words and
terms, when used in this chapter shall have the following meaning, unless
the context clearly indicates otherwise.
(1)
Department--The Texas Department of Housing and Community
Affairs.
(2)
Owner-Builder--A person, other than a person who owns or
operates a construction business, who undertakes to make improvements to property
owned or being purchased as described in subparagraphs (A) or (B) of this
paragraph:
(A)
real property owned or purchased through a warranty deed
or a warranty deed and deed of trust; or
(B)
real property purchased under a contract for deed entered
into before January 1, 1999.
(3)
Texas Bootstrap Loan Program--The popular name of the Owner-Builder
Loan Program.
§2.2.Owner-Builder Eligibility.
(a)
A priority is established for loans made to Owner-Builders
with an annual income of less than $17,500.
(b)
To be eligible for a loan, an Owner-Builder:
(1)
may not have an annual income that exceeds 60 percent,
as determined by the Department, of the greater of the state or local median
family income, when combined with the income of any person who resides with
the Owner-Builder;
(2)
must have resided in this state for the preceding six months;
(3)
must have successfully completed an Owner-Builder education
class pursuant to §2.11 of this chapter; and
(4)
must agree to:
(A)
provide at least 60 percent (60%) of the labor necessary
to build or rehabilitate the proposed housing by working through a owner-builder
housing program certified by the Department as described in §2.10 of
this chapter; or
(B)
provide an amount of labor equivalent to the amount required
under subparagraph (A) of this paragraph in connection with building housing
for others through a Nonprofit Owner-Builder Housing Program certified by
the Department, pursuant to §2.10 of this chapter.
§2.3.Loan Amount and Loan Terms.
(a)
At least two-thirds of the dollar amount of loans made
under this subchapter in each fiscal year must be made to Owner-Builders whose
property is located in a county that is eligible to receive financial assistance
under Subchapter K, Chapter 17, Water Code.
(b)
The Department may establish a minimum of $1,000 loan amount
under this subchapter and a maximum loan amount of $30,000.
(c)
If $30,000 is not adequate for this purpose, the Owner-Builder
must obtain the amount necessary that exceeds $30,000 from one or more local
governmental entities, nonprofit organizations, or private lenders.
(d)
The total amount of loans made by the Department and other
entities pursuant to this subchapter may not exceed $60,000.
(e)
A loan made by the Department under this subchapter:
(1)
may not exceed a term of 30 years;
(2)
may bear interest at a fixed rate of not more than three
percent (3%) or bear interest in the manner described in subparagraphs (A)
through (D) of this paragraph:
(A)
no interest for the first two years of the loan;
(B)
beginning with the second anniversary of the loan date,
interest at the rate of one percent (1%) per year;
(C)
beginning with the third anniversary of the loan date and
ending on the sixth anniversary of the loan date, interest at a rate of one
percent (1%) greater than the rate borne in the preceding year; and
(D)
beginning with the sixth anniversary of the loan date was
made and continuing through the remainder of the loan term, interest at the
rate of five percent (5%); and
(3)
may be secured by a lien on the real property, including
a lien that is subordinate to a lien that secures a loan made under subsection
(b) of this section and that is greater than the Department's lien.
(f)
If an Owner-Builder is purchasing real property under a
contract for deed, the Department will not disburse any portion of a loan
made under this subchapter until the owner-builder:
(1)
fully completes the owner-builder's obligation under the
contract and receives a deed to the property; or
(2)
refinances the Owner-Builder's obligation under the contract
and converts the obligation to a note secured by a deed of trust.
(g)
The Department shall give priority to loans to owner-builders
who will reside in counties or municipalities that agree in writing to waive
capital recovery fees, building permit fees, inspection fees, or other fees
related to the building or rehabilitation of the housing to be built with
the loan proceeds.
§2.4.Certification of Owner-Builder Housing Programs.
The Department may select Nonprofit Owner-Builder Housing Programs,
pursuant to §2.10 of this chapter, to certify the eligibility of Owner-Builders
to receive a loan under this subchapter. A nonprofit housing assistance organization
selected by the Department shall use the eligibility requirements established
by the Department to certify the eligibility of an Owner-Builder for this
program.
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of
the Secretary of State on March 10, 2003.
TRD-200301636
Edwina P. Carrington
Executive Director
Texas Department of Housing and Community Affairs
Earliest possible date of adoption: April 20, 2003
For further information, please call: (512) 475-3726
Subchapter B. A NONPROFIT OWNER-BUILDER HOUSING PROGRAM ELIGIBILITY
10 TAC §2.10, §2.11
The Texas Department of Housing and Community Affairs (the
Department) proposes new §2.10 and §2.11, concerning the Nonprofit
Owner-Builder Housing Program. The purpose of these sections is to provide
hearing establish the requirements of this program pursuant to Subchapter
FF of Chapter 2306, Texas Government Code.
Ms. Edwina P. Carrington, Executive Director, has determined that for the
first five-year period the proposed sections are in effect there will be no
fiscal implications for state or local government as a result of enforcing
or administering the rules.
Ms. Carrington also has determined that for each year of the first five
years the proposed sections are in effect, the public benefit anticipated
as a result of enforcing these sections will be will be more affordable housing
for the State of Texas. There will be no effect on persons, small businesses
or micro-businesses. There are no anticipated economic costs to persons, small
businesses or micro-businesses who are required to comply with these sections
as proposed. The proposed new sections will not have an impact on any local
economy.
Comments may be submitted to Anne O. Paddock, Deputy General Counsel, Texas
Department of Housing and Community Affairs, P.O. Box 13941, Austin, Texas,
78711-3941 or by email at the following address: apaddock@tdhca.state.tx.us.
The new sections are proposed pursuant to the authority of the
Texas Government Code, Chapter 2306.
The new sections affect no other code, article or statute.
§2.10.A Nonprofit Owner-Builder Housing Program.
A Nonprofit Owner-Builder Housing Program, pursuant to Sections 2306.752
and 2306.753, Texas Government Code, which may become certified by the Department
by providing services to potential Owner-Builders as set out in paragraphs
(1) through (4) of this subsection, means a tax-exempt organization listed
under section 501(c)(3), Internal Revenue Code of 1986, as amended, or through
the colonia self-help centers established under Chapter 2306, Subchapter Z,
Texas Government Code, to:
(1)
qualify potential Owner-Builders for loans under this subchapter;
(2)
provide Owner-Builder education classes under Section 2306.756,
Texas Government Code;
(3)
assist Owner-Builders in building housing; and
(4)
originate or service loans made under subchapter A of this
chapter.
§2.11.Owner-Builder Education Classes.
(a)
A state-certified Nonprofit Owner-Builder Housing Program
shall offer Owner-Builder education classes to potential owner-builders as
set out in subchapter A of this chapter.
(b)
Owner-Builder Education Classes must provide information
on:
(1)
the financial responsibilities of an owner-builder under
this chapter, including the consequences of an Owner-Builder's failure to
meet those responsibilities;
(2)
the building of housing by Owner-Builders;
(3)
resources for low-cost building materials available to
Owner-Builders; and
(4)
resources for building assistance available to Owner-Builders
as set out in subchapter A of this chapter.
(c)
A Nonprofit Owner-Builder Housing Program may charge a
potential Owner-Builder who enrolls in a class under this subchapter a reasonable
fee not to exceed fifty dollars ($50.00) to offset the program's costs in
providing the class.
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of
the Secretary of State on March 10, 2003.
TRD-200301637
Edwina P. Carrington
Executive Director
Texas Department of Housing and Community Affairs
Earliest possible date of adoption: April 20, 2003
For further information, please call: (512) 475-3726