Neighborhood Stabilization Program (NSP)

Harris County’s Neighborhood Stabilization Program will fund projects that create homeownership opportunities and stabilize neighborhoods through the acquisition and rehabilitation of foreclosed and vacant properties across the Harris County area.

The unique program will allow qualified buyers, with the assistance of their real estate agents, to identify foreclosed homes in which they would like to purchase as their primary residence. Harris County Community Services Department would then buy those properties and resell them to applicants at 20% below the purchase price. Qualified homebuyers may be eligible for an additional discount up to 10% to help meet affordability.

Steps to Getting Started

1. Obtain a homebuyer certificate from a HUD approved Homebuyer education course provider.
2. Contact us to complete the pre-qualification process. You will receive a pre-qualification letter.
3. Submit the following documents:
   • Current six (6) months of bank statements (checking/savings).
   • Current three (3) years of income Tax returns (include W-2’s and 1099’s)
   • Current three (3) months of Pay stubs.
   • Other income information such as: child support, alimony, social security benefits, retirement accounts (IRA’s, 401K), disability or worker’s compensation.
   • Birth certificate for everyone living in the home.
   • Divorce papers, if applicable
4. Contact us for a participating Real Estate Agent.
5. Have your Realtor locate a foreclosed/vacant within the approved zip code area.
6. Once you have decided on a property your Realtor will complete and submit the Property Registration Package to Harris County Lending Service.
7. Once a week your Realtor will keep you informed of the status and next step.

Eligible homes in Harris County must be located within one of the following approved zip code areas.

Assistance with HCCSD approved home repairs up to $10,000 may also be available under NSP.

Property Criteria

• Must be foreclosed and vacant
• Must be no older than 12 years old in age
• Purchase price can not exceed FHA 203(b) limits
• Home repairs must not exceed $10,000.00
• Seller must be willing to sell property at a discount of at least 1% off the appraised value not to exceed the listed price

Buyer Criteria

• Must have completed an 8 hour HUD approved certified homebuyer class
• Must be mortgage pre-qualified for fixed rate loan by one of the approved lenders
• Must be U.S. citizen or a Permanent Resident Alien (documentation required)
• Must have at least one credit score that is a 620
• Must not have owned another home in the U.S. within the last 3 years (except a mobile home)
• Mortgage payment to gross monthly income cannot exceed 30% and total monthly debt cannot exceed 42%
• Income cannot exceed 120% of Area Median Income
• Must reside in home as primary residence for the term of affordability period

Frequently Asked Questions

1. Will the Appraisal reports be FHA or Conventional?
   Answer: The appraisal Harris County will order will be for the benefit of Harris County; however, if it is an FHA appraisal and is assigned an FHA case #, it can be used by the buyer’s lender at their discretion.
   
   
2. Who has the county contracted to complete the repair work? How will the homebuyer and Mortgage Lender know about the repairs that need to be done?
   Answer: Harris County has approved contractors to complete the repairs. Upon completion of the inspection report, Harris County will provide the homebuyer and the homebuyer’s lender with a scope of work to be completed by Harris County..
   
   
3. Are HUD homes allowed under this program?
   Answer: Unfortunately, HUD properties would be difficult to obtain because of their transaction process..
   
   
4. Will Harris County provide a seller contribution to help with closing costs?
   Answer: Yes, when the buyer purchases the property from Harris County, we will a 6% contribution..
   
   
5. Who negotiates the contract with the Seller/Bank on behalf of the County?
   Answer: Harris County will handle its own negotiations and will submit the offer to the Seller, based on what the homebuyer is willing to offer for the property..
   
   
6. We know there will be 2 contracts. Who prepares the 1st TREC Earnest Money Contract between the Seller/Bank and Harris County and the 2nd EMC between the Homebuyer and Harris County?
   Answer: Harris County will prepare the contract to acquire the property from the Seller. The Buyer’s Agent prepares the contract for the homebuyer to acquire the property from Harris County, (which must include special provisions provided by Harris County).
   
   
7. Are properties that are posted for multiple bidding allowed under this program?
   Answer: Properties under multiple bidding would be difficult to obtain because of the bidding process..
   
   
8. Will there be a Registration Form for us to complete in order to submit a homebuyer’s package?
   Answer: Yes, the Registration form will be available and submitted by your Realtor. A TREC earnest money contract showing Harris County as the Seller of the property with the sales price reflected as the list price..
   
   
9. What is the minimum credit score and other required underwriting criteria?
   Answer: Homebuyers should have at least one credit score that is a minimum of 620..
   
   
10. Since the County will order and pay for an Appraisal, will the Mortgage Lender accept this appraisal as well?
    Answer: That is subject to the lender’s discretion. You should check with them to confirm..
    
    
11. Who will conduct and pay for the Property Inspection and Survey?
    Answer: Harris County approved TREC Inspectors and Surveyors will perform these services..
    
    
12. Although significant equity may be injected upfront as a result of discounts offered by the County, will the Mortgage Lender take that into consideration for the purpose of not requiring MI/PMI?
    Answer: That is subject to the lender’s discretion..
    
    
13. Will the county pay for the homebuyer’s Title Policy?
    Answer: Yes.
    
    
14. Who will perform the Appraisal process for the county?
    Answer: Harris County will use independent fee appraisers who are contracted by Harris County Right of Way Division..
    
    
15. Will the Appraisal Reports be assigned a Case Number? For FHA Appraisals, this will be particularly helpful as Mortgage Lenders may be more inclined to accept the appraisal vs. ordering their own.
    Answer: In most cases, an appraisal that is assigned a FHA case # should be accepted by the lender; however, that is subject to the lender’s discretion..
    
    
16. If a potential homebuyer is applying for a work permit/visa, will they be eligible under this program?
    Answer: We require the applicant to be a Permanent Resident Alien, or a U.S. Citizen. If applicant is married, only one of them must be a Permanent Resident Alien or a U.S. Citizen..
    
    
17. Can a homebuyer combine DAP with the NSP program?
    Answer: Because we are the seller and the majority of lenders allow only a maximum 6% seller contribution, DAP cannot be combined with NSP..