Housing Services:
Shared Appreciation Mortgage

Features/Benefits

The Shared Appreciation Mortgage (SAM) is a homebuyer assistance tool designed exclusively for first-time homebuyers who are buying a home in the Interstate Corridor or the Lents Town Center Urban Renewal Areas. It is a second mortgage loan used in conjunction with a fi rst mortgage loan from PDC to increase buying power and provide additional funds for renovation. Essentially, the SAM loan is gap fi nancing that makes up the difference between what a homebuyer's income will support and the higher sales price of a property.

The SAM loan does not accrue interest or require a monthly payment. Instead, the loan is repaid when the home is refi nanced or sold. At that time, the original loan amount is due, along with a portion of any appreciation realized on the property over time. Thus the term "shared appreciation mortgage."

Eligibility Requirements

Eligible Homebuyer

First-time homebuyer (defi ned as not having owned a home in the past three years)
Owner-occupied residences only
Annual household income at or below 80% of Portland area Median Family Income (MFI), adjusted for family size

Household Size	80 percent MFI (2007) *
1	$38,000
2	$43,450
3	$48,900
4	$54,300

Must meet standard fi rst mortgage criteria for credit and down payment
Maximum $20,000 in liquid assets allowed after payment of down payment and closing costs (excludes retirement accounts)

*Higher household income limits apply for households of fi ve or more persons.

Eligible Property

Residential properties located in the Interstate Corridor or the Lents Town Center Urban Renewal Areas (URA). For a map of theses areas, see the Interstate Corridor URA map and the Lents Town Center URA map.
Maximum purchase price, $284,600

Loan Terms

SAM loan must be used in conjunction with a PDC Community Renovation Loan or a PDC Oregon Bond Loan
The SAM is a 25-year loan at zero interest and no monthly payment
The maximum SAM amount is 25% of the purchase price, including an additional 5% for renovation
The first mortgage amount is established at 80% of purchase price, which avoids private mortgage insurance
Repayment is deferred until the sale of the unit, refi nance of the fi rst mortgage, or when the homeowner no longer occupies the home as their primary residence; at such time, the entire principal plus 25% of the appreciation is due and payable; the appreciation equals the sales price less
the costs to sell, any capital improvements and the original acquisition costs
If the home remains owner-occupied for 25 years, the entire SAM amount, including any appreciation,
is forgiven

The borrower has two options for renovations:

Immediate Renovations – A minimum 5% up to a maximum 50% of the sales price plus renovation costs are placed in PDC escrow account to pay for improvements made within six months of closing; the appraisal is done based on an “after-improved” evaluation;

Future Home Improvements – A minimum of 5% of the sales price is placed in a PDC escrow account to pay for eligible improvements identifi ed after the purchase and made within 24 months of closing; can borrow up to 105% of the Combined Loan-To Value; the appraisal is done based on an “as-is” evaluation

For more information call 503-823-3400, e-mail.