INTOWN MACON HISTORIC DISTRICT
DOWN PAYMENT ASSISTANCE PROGRAM
A PARTNERSHIP FOR HISTORIC REVITALIZATION:
KNIGHT FOUNDATION AND MERCER UNIVERSITY
The John S. and James L. Knight Foundation and Mercer University have partnered to offer a Down Payment Assistance Program for University employees to encourage the purchase of new or rehabilitated homes in the College Hill project area (also known as the Intown Macon Neighborhood, comprised of Beall’s Hill, College Hill, Tattnall Square Heights, Tindall Heights and Huguenin Heights).
The Program is a benefit made available to full-time Mercer employees.
The program exists to encourage Mercer employees to participate in the revitalization of the College Hill project area surrounding Mercer, where the University is working in partnership with the community to conserve and rebuild the historic urban fabric. The Beall’s Hill neighborhood, an area of thirty blocks (100 acres) defined and surveyed in the Beall’s Hill Urban Design and Architectural Guidelines, is a particular focus of this Program. Only properties within College Hill project area are eligible for this program. The area is highlighted in the map below.
The Program offers Down Payment Assistance to qualified University employees who buy eligible homes in the College Hill project area and live in the homes for a minimum of five (5) years after the date of purchase. The amount of the assistance is seventeen per cent (17%) of the purchase price of the completed home, up to a maximum of twenty thousand dollars ($20,000).
|PURCHASE PRICE OF HOME
||LIMIT OF CONTRIBUTION
||17% of Purchase Price
|$77,500 or Below
||17% of Purchase Price plus closing costs
Payment (and Repayment)
The University’s contribution will be payable at closing to the homebuyer and the closing attorney. The University will retain a security interest in the property in the form of a zero-interest Retention Agreement, setting forth the conditions under which the purchaser will be required to repay all or a portion of the University’s contribution. This repayment obligation may be satisfied through continuous ownership and occupancy of the property over a period of five years (one-fifth of the repayment obligation being satisfied annually on the anniversary date of closing.) If the property is sold before the end of the initial five-year residency period, a prorated portion of the initial Down Payment Assistance must be repaid to the University at the time of ownership transfer.
By using this program, the home purchaser agrees that the home will only be used as a single family, owner-occupied residence, meaning that it cannot be rented by the person receiving the stipend, nor any subsequent owner. To make this agreement binding in perpetuity, the following restrictive covenants must be incorporated into the deed conveying title to the purchaser (Grantee):
- Grantee covenants that the property will not be used for any other purpose than owner- occupied single-family residential use without the express permission of Mercer University or its successor-in-interest.
- Grantee covenants that a violation of the preceding covenant shall entitle Mercer University or its successor-in-interest to injunctive relief and to reasonable attorney’s fees and costs incurred in pursuing a petition for injunctive relief.
Because this program exists to improve the College Hill project area, existing homes are not eligible for the project except in a few unique circumstances. In general, a home must either be:
- Newly constructed and never occupied, or
- An historic home that has been substantially rehabilitated and not occupied since the rehabilitation was completed.
In addition, the property must conform to the following criteria:
- Location: College Hill project area
- Minimum Square Footage: 500 sq. ft.
- Minimum Purchase Price (or value after rehabilitation): $50,000
Any rehabilitated home purchased from the Historic Macon Foundation that meets the aforementioned criteria is also eligible for the Employee Down Payment Assistance benefit.
Homes rehabilitated by private builders
Historic homes rehabilitated by private developers or speculative owners are only eligible for this program if they meet the following criteria, in addition to the criteria listed above:
- The home has been substantially rehabilitated, meaning that the developer has invested half (50%) of the value of the home in improvements within the past twenty-four (24) months, and
- The developer has filed the appropriate applications for the Georgia Preferential Property Tax Assessment Program for Rehabilitated Historic Properties from the State Historic Preservation Office (SHPO), and can provide the certified part “B” section of this application to the purchaser.
Un-rehabilitated historic homes
Historic homes in need of major rehabilitation may be eligible for the program if the purchaser of the home meets all of the standard criteria and is willing to undertake a substantial rehabilitation by investing half (50%) of the value of the home in improvements over twenty-four (24) months. The work must be conducted under a certified part “A” application from the State Historic Preservation Office (DO NOT START WORK WITHOUT FILING A TAX CREDIT APPLICATION).
Eligible properties must qualify for the Georgia Preferential Property Tax Assessment Program for Rehabilitated Historic Properties, i.e., (a) the property must be listed on the National Register of Historic Places, and (b) the property must be rehabilitated in accordance with the guidelines of the Department of Natural Resources Georgia Historic Preservation Division, and (c) the property must be used as an owner-occupied historic home that is a principal residence, and (d) rehabilitation must increase the fair market value of the building by at least 50%.
If the owner meets these criteria, the down payment assistance funds may be disbursed in either of the following ways, at the home purchaser’s discretion:
- At closing on a construction loan to complete a substantial rehabilitation of an eligible property. Prior to disbursing funds, the borrower must provide a commitment letter and a copy of the certified part “A” section of an application to the Georgia Preferential Property Tax Assessment Program for Rehabilitated Historic Properties for historic tax credits (Georgia tax credit application) from the State Historic Preservation Office (SHPO). After closing, the construction loan closing statement must be provided to Mercer University’s benefits office. The project must be completed within twenty-four (24) months. At the completion of the project, the owner will be required to submit the certified part “B” section of a Georgia tax credit application from SHPO. If for any reason the owner of the property fails to complete the project as proposed or fails to submit the certified part “B” application by the deadline, the entire amount loaned through the down payment assistance program must be repaid.
- At conversion to a permanent mortgage. If the homeowner elects to have the benefit paid at conversion to a permanent loan, all that must be provided is the approved Part B application.
In addition to being eligible for down payment assistance, adhering to these guidelines will provide two other incentives for homeowners who undertake their own rehabilitation projects. Property taxes on homes that qualify for the Georgia Preferential Property Tax Assessment Program for Rehabilitated Historic Properties will be frozen at pre-rehabilitation valuation levels for a period of eight (8) years. An income tax credit for historic rehabilitation is also available through the Historic Preservation Division. Historic Macon Foundation (www.historicmacon.org) can answer questions about property eligibility and serves as experienced consultant for the design and application process for the Georgia Preferential Property Tax Assessment Program for Rehabilitated Historic Properties.
Houses in the Huguenin Heights neighborhood that are currently investor-owned or occupied by someone other than the owner will be eligible for the Employee Down Payment Assistance Program, regardless of whether such houses have been previously purchased and rehabilitated by a full-time Mercer employee under the Program.
Houses in the Huguenin Heights neighborhood that Mercer purchases to remove from the rental market will also be eligible for the Employee Down Payment Assistance Program, regardless of whether such houses have been previously purchased and rehabilitated by a full-time Mercer employee under the Program.
Foreclosed properties located in the eligible neighborhoods that otherwise would not qualify for the Down Payment Assistance Program may be — on a case-by-case basis — approved for grants, with the consent of the President of the University and the appropriate Knight Foundation program officer.
To be eligible to receive the Employee Down Payment Assistance benefit, the Employee must provide:
- a description of the property to be purchased, including the final purchase price or appraised value of the property; and
- a deed of conveyance that includes the above-described restrictive covenants; and
- a signed security interest retention agreement with Mercer University; and
- in the case of a property to be rehabilitated by the homeowner, a copy of a commitment letter from a lender showing adequate funds to complete a substantial rehabilitation along with a copy of the part “A” section of the Georgia tax credit application; and
- in the case of rehabilitated homes, a copy of the certified part “B” section of the Georgia tax credit application (as filed with the local tax assessor to qualify for a continuing tax freeze on the property).
The University will issue a letter of intent for the purposes of securing a loan commitment from a lending institution when a contract for a qualifying property is presented.
The availability of the Employee Down Payment Assistance benefit is dependent on the availability of budgeted funds in any given fiscal year on a first-come, first-served basis. The Benefits and Payroll Administration Office of Mercer University must certify eligibility.
To apply for the Employee Down Payment Assistance benefit, or for more information about the program, contact:
Benefits and Payroll Administration Office
1206 College Street
Macon, Georgia 31207