Fourth Amendment to HPA — North Carolina 

TAMPA/182364.1

FOURTH AMENDMENT TO 

COMMITMENT TO PURCHASE FINANCIAL INSTRUMENT 

and 

HFA PARTICIPATION AGREEMENT 

This Fourth Amendment to Commitment to Purchase Financial Instrument and HFA 

Participation Agreement (the “Fourth Amendment”) is entered into as of the date set forth on 

Schedule A attached hereto as the Fourth Amendment Date (the “Amendment Date”), by and 

among the United States Department of the Treasury (“Treasury”), the undersigned party 

designated as HFA whose description is set forth in Schedule A attached hereto (for 

convenience, a “state housing finance agency” or “HFA”) and the undersigned institution 

designated by HFA to participate in the program described below (“Eligible Entity”). 

Recitals 

WHEREAS, Treasury, HFA and Eligible Entity entered into that certain Commitment to 

Purchase Financial Instrument and HFA Participation Agreement (the “Original HPA”) dated as 

of the Closing Date, as previously amended by that certain First Amendment to Commitment to 

Purchase Financial Instrument and HFA Participation Agreement (the “First Amendment”), as 

further amended by that certain Second Amendment to Commitment to Purchase Financial 

Instrument and HFA Participation Agreement (the “Second Amendment”), and as further 

amended by that certain Third Amendment to Commitmen to Purchase Financial Instrument and 

HFA Participation Agreement (the “Third Amendment”; and together with the Original HPA as 

amended thereby and by the First Amendment and Second Amendment, the “Current HPA”), 

dated as of their respective dates as set forth on Schedule A attached hereto, in connection with 

Treasury’s federal housing program entitled the Housing Finance Agency Innovation Fund for 

the Hardest Hit Housing Markets (the “HHF Program”), which was established pursuant to the 

Emergency Economic Stabilization Act of 2008 (P.L. 110-343), as amended, as the same may be 

amended from time to time (“EESA”); 

WHEREAS, HFA and Eligible Entity submitted a request to Treasury to make certain revisions 

to their Service Schedules and Treasury has agreed to the same; 

WHEREAS, HFA, Eligible Entity and Treasury wish to enter into this Fourth Amendment to 

document all approved modifications to the Service Schedules; 

Accordingly, in consideration of the representations, warranties, and mutual agreements set forth 

herein and for other good and valuable consideration, the receipt and sufficiency of which are 

hereby acknowledged, Treasury, HFA and Eligible Entity agree as follows. 

Agreement 

1. Amendments

A. Definitions. All references in the Current HPA to the “Agreement” shall mean the 

Current HPA, as further amended by this Fourth Amendment; and all references in the 
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TAMPA/182364.1 

Current HPA to Schedules A or B shall mean the Schedules A or B attached to this Fourth 

Amendment. All references herein to the “HPA” shall mean the Current HPA, as further 

amended by this Fourth Amendment. 

B. Schedule A. Schedule A attached to the Current HPA is hereby deleted in its entirety 

and replaced with Schedule A attached to this Fourth Amendment. 

C. Schedule B. Schedule B attached to the Current HPA is hereby deleted in its entirety 

and replaced with Schedule B attached to this Fourth Amendment. 

2. Representations, Warranties and Covenants

A. HFA and Eligible Entity. HFA and Eligible Entity, each for itself, make the 

following representations, warranties and covenants to Treasury and the truth and accuracy 

of such representations and warranties and compliance with and performance of such 

covenants are continuing obligations of HFA and Eligible Entity, each as to itself. In the 

event that any of the representations or warranties made herein cease to be true and correct or 

HFA or Eligible Entity breaches any of its covenants made herein, HFA or Eligible Entity, as 

the case may be, agrees to notify Treasury immediately and the same shall constitute an 

Event of Default under the HPA. 

(1) HFA and Eligible Entity each hereby certifies, represents and warrants as of the 

date hereof that each of the representations and warranties of HFA or Eligible Entity, as 

applicable, contained in the HPA are true, correct, accurate and complete in all material 

respects as of the date hereof. All covenants of HFA or Eligible Entity, as applicable, 

contained in the HPA shall remain in full force and effect and neither HFA, nor Eligible 

Entity is in breach of any such covenant. 

(2) Eligible Entity has the full corporate power and authority to enter into, execute, 

and deliver this Fourth Amendment and any other closing documentation delivered to 

Treasury in connection with this Fourth Amendment, and to perform its obligations 

hereunder and thereunder. 

(3) HFA has the full legal power and authority to enter into, execute, and deliver this 

Fourth Amendment and any other closing documentation delivered to Treasury in 

connection with this Fourth Amendment, and to perform its obligations hereunder and 

thereunder. 

3. Miscellaneous

A. The recitals set forth at the beginning of this Fourth Amendment are true and accurate 

and are incorporated herein by this reference. 

B. Capitalized terms used but not defined herein shall have the meanings ascribed to 

them in the HPA. 

C. Any provision of the HPA that is determined to be prohibited or unenforceable in any 

jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or 
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TAMPA/182364.1 

unenforceability without invalidating the remaining provisions of the HPA, and no such 

prohibition or unenforceability in any jurisdiction shall invalidate such provision in any other 

jurisdiction. 

D. This Fourth Amendment may be executed in two or more counterparts (and by 

different parties on separate counterparts), each of which shall be deemed an original, but all 

of which together shall constitute one and the same instrument. Facsimile or electronic 

copies of this Fourth Amendment shall be treated as originals for all purposes. 

[SIGNATURE PAGE FOLLOWS; REMAINDER OF PAGE 

INTENTIONALLY LEFT BLANK] 
[Signature Page to Fourth Amendment to HPA — North Carolina] 

TAMPA/182364.1

In Witness Whereof, HFA, Eligible Entity and Treasury by their duly authorized officials 

hereby execute and deliver this Fourth Amendment to Commitment to Purchase Financial 

Instrument and HFA Participation Agreement as of the Amendment Date. 

HFA: TREASURY: 

NORTH CAROLINA HOUSING FINANCE 

AGENCY 

UNITED STATES DEPARTMENT OF THE 

TREASURY 

By: /s/ A. Robert Kucab By: 

Name: A. Robert Kucab Name: Timothy G. Massad 

Title: Executive Director Title: Acting Assistant Secretary for 

 Financial Stability 

 

ELIGIBLE ENTITY:

NORTH CAROLINA HOUSING FINANCE 

AGENCY 

By: /s/ A. Robert Kucab 

Name: A. Robert Kucab 

Title: Executive Director 

 

TAMPA/182364.1 

EXHIBITS AND SCHEDULES

Schedule A Basic Information 

Schedule B Service Schedules 
TAMPA/182364.1 

SCHEDULE A

BASIC INFORMATION

Eligible Entity Information: 

Name of the Eligible Entity: North Carolina Housing Finance Agency1

Corporate or other organizational form: a body politic and corporate under the laws 

of the State of North Carolina pursuant to N. 

C. G. S. Chapter 122A

Jurisdiction of organization: North Carolina

Notice Information: North Carolina Housing Finance Agency 

 Attn: Betsy Rozakis, Chief Financial Officer 

 3508 Bush Street 

 Raleigh, North Carolina 27609 

 Phone: (919) 877-5687 

 Fax: (919) 877-5703 

 E-mail: eirozakis@nchfa.com 

 With a copy to: North Carolina Housing Finance Agency 

 Attn: Bob Kucab, Executive Director 

 3508 Bush Street 

 Raleigh, North Carolina 27609 

 Phone: (919) 877-5600 

 Fax: (919) 877-5703 

 E-mail: arkucab@nchfa.com 

 

HFA Information: 

Name of HFA: North Carolina Housing Finance Agency1

Organizational form: a body politic and corporate under the laws 

of the State of North Carolina pursuant to N. 

C. G. S. Chapter 122A 

Date of Application: June 1, 2010 

Date of Action Plan: September 1, 2010 

 

1

 References in the Agreement to the term “HFA” shall mean the North Carolina Housing Finance Agency 

(“NCHFA”) in its capacity as HFA as such term is used in the Agreement; and references in the Agreement to the 

term “Eligible Entity” shall mean NCHFA, in its capacity as Eligible Entity as such term is used in the Agreement. 
TAMPA/182364.1 

Notice Information: Same as notice information for Eligible 

Entity.

Program Participation Cap: $482,781,786.00 

Portion of Program Participation Cap 

Representing Original HHF Funds: $159,000,000.00 

Portion of Program Participation Cap 

Representing Unemployment HHF Funds: $120,874,221.00 

Permitted Expenses: $62,200,000.00

Closing Date: August 3, 2010 

First Amendment Date: September 23, 2010 

Second Amendment Date: September 29, 2010 

Third Amendment Date: December 16, 2010 

Fourth Amendment Date: May 25, 2011 

Eligible Entity Depository Account Information: See account information set forth in the 

Depository Account Control Agreement 

between Treasury and Eligible Entity 

regarding the HHF Program. 
TAMPA/182364.1 

SCHEDULE B

SERVICE SCHEDULES

The Service Schedules attached as Schedule B to the Current HPA are hereby deleted in their entirety and 

replaced with the attached Service Schedules (numbered sequentially as Service Schedule B-1, Service 

Schedule B-2, et. seq.), which collectively comprise Schedule B to the HPA. 
TAMPA/182364.1 

SERVICE SCHEDULE B-1

North Carolina Housing Finance Agency’s 

Mortgage Payment Program (MPP-1)

Summary Guidelines 

4. Program Overview North Carolina has one of the highest unemployment rates in the 

country with more than 490,000 people out of work as of April 

2010. Because unemployed homeowners are not eligible for most 

loss mitigation programs, NCHFA proposes to use a majority of 

our HFA Hardest Hit Funds (HHF) to create the Mortgage 

Payment Program (MPP-1). 

This program will provide loans to unemployed homeowners and 

others who, through no fault of their own, are financially unable 

to make their mortgage payments and are in danger of losing their 

homes to foreclosure. 

Loan proceeds will be used to pay mortgage and mortgage-related 

expenses (i.e. property taxes, homeowner insurance, homeowner 

dues) until the homeowner secures employment or completes 

training for a new career. 

5. Program Goals To assist 5,750 homeowners over the next 3 years. The following 

types of assistance will be provided: 

Job Search or Short-term Assistance 

To help homeowners while they look for a new job. 

Job Training or Long-term Assistance 

To help homeowners while they complete a job training/education 

program to help secure a new job. 

Reinstatement Only or One-time Assistance

To help homeowners who have found a new job but need help to 

bring their mortgage current. 

6. Target Population/ 

Areas 

Homeowners who are unemployed, suffered another temporary 

hardship, and/or reemployed but need help bringing their 

mortgage current. 

 

This Program will be available in all North Carolina counties. 

NCHFA will provide additional assistance over a longer period of 

time to eligible homeowners living in targeted or “hardest hit” 

counties, those with 2009 or thereafter unemployment rates 

greater than or equal to 11.3%. 

7. Program Allocation $99,400,000.00 
TAMPA/182364.1 

(Excluding 

Administrative 

Expenses) 

8. Borrower Eligibility 

Criteria 

Unemployed homeowners and others who, through no fault of 

their own, are unable to make their mortgage payments and are at 

risk of a foreclosure. Homeowners will be required to provide a 

financial hardship affidavit with appropriate documentation on 

the cause of their hardship. For most homeowners, this will be 

documentation from the Employment Security Commission 

(ESC) confirming a job loss and receipt of unemployment 

benefits. If information from ESC is unavailable, a notarized 

letter from the former employer indicating job loss was not the 

fault of the borrower will serve as a substitute. Self-employed 

borrowers will be required to submit prior tax returns to show a 

loss of income. 

Employed homeowners who are delinquent because of a prior job 

loss or other program eligible hardship but who can resume future 

payments without additional assistance. 

Satisfactory mortgage payment history. 

 

All principal, interest, taxes, homeowner insurance, mortgage 

insurance, homeowner association dues, and the cost of utilities 

>31% of household income after job loss/loss of income. 

Borrowers must meet program underwriting criteria. 

Eligibility for program assistance will be determined primarily by 

participating foreclosure prevention partners. 

Funds will be allocated on a first come/approved, first served 

basis. 

9. Property/Loan 

Eligibility Criteria 

Existing single-family homes or condominiums (attached or 

detached) including manufactured homes on foundations 

permanently affixed to real estate owned by the borrower. 

North Carolina owner-occupied, primary residences only. 

Combined Loan-to-Value cannot exceed 125%. 

10. Program Exclusions Total Unpaid Principal Balances > $275,000. 

 

Manufactured homes not considered real property. 

Non-legal U.S. resident. 

11. Structure of 10 year, 0% interest, non-recourse, deferred-payment forgivable 
TAMPA/182364.1 

Assistance subordinate loan. A forgiveness clause will reduce the loan 

amount by 20% a year for every year the borrower stays in the 

home after five years. At the end of the 10 years, the note will be 

considered satisfied, and NCHFA will release the lien securing 

the note. 

Loan funds are due and payable if property is sold, refinanced or 

no longer owner occupied (unless otherwise prohibited under 

applicable federal law). Loans are repayable only from proceeds 

to the borrower from a sale or refinance. If the property is sold or 

refinanced and has not increased in equity to the degree necessary 

to repay the note, all or a portion of the note will be forgiven. 

NCHFA will agree to subordinate the MPP-1 Loan for borrowers 

who refinance their mortgage(s) to receive more favorable loan 

terms. If a borrower refinances their loan to consolidate debt or 

receives cash out, the borrower would be required to repay the 

MPP-1 Loan according to the loan terms. 

All deferred, subordinate mortgages will be evidenced by a 

promissory note and secured by a deed of trust on the property. 

Borrowers will be required to sign and acknowledge via Written 

Agreement indicating the program guidelines. 

Any funds returned according to established program guidelines 

will be recaptured and used to assist additional homeowners 

through December 31, 2017. After December 31, 2017, the funds 

will be returned to Treasury. 

12. Per Household 

Assistance 

The average loan amount will be $20,000 per borrower. 

Targeted Counties (2009 or thereafter Unemployment Rate >

11.3%): 

Maximum assistance up to $36,000 and not to exceed 36 months 

per household. 

Non-Targeted Counties (2009 Unemployment Rate < 11.3%): 

Maximum assistance up to $24,000 and not to exceed 24 months 

per household. 

13. Duration of Assistance Targeted Counties (2009 or thereafter Unemployment Rate ≥

11.3%):

Up to 36 months for those in job training/education program. 

Up to 18 months for those in a job search. 

Non-Targeted Counties (2009 Unemployment Rate < 11.3%):

Up to 24 months for those in job training/education program. 

Up to 12 months for those in a job search. 
TAMPA/182364.1 

14. Estimated Number of 

Participating 

Households 

5,750 homeowners over the next 3 years. 

Estimated number served based on average loan amount of 

$20,000 per homeowner. 

15. Program Inception/ 

Duration 

Program began October 18, 2010 and will last up to 3 years. 

16. Program Interactions 

with Other Programs 

(e.g. other HFA 

programs) 

Borrowers can access more than one of our HHF programs, if 

needed and appropriate. For example, a borrower can receive 

MPP-1 assistance while they look for a new job and then receive 

Second Mortgage Refinance Program or Permanent Loan 

Modification Program assistance once they secure a new job. 

17. Program Interactions 

with HAMP 

The MPP-1 would help borrowers who need more than the 3-6 

months of assistance available through the new Home Affordable 

Unemployment Program (UP), which began August 1, 2010. 

Borrowers who are eligible for MPP-1 would not be required to 

participate in UP prior to receiving assistance with MPP-1. 

In addition, MPP-1 would also help borrowers who don’t qualify 

for assistance under the new UP because they are more than 3 

months behind in mortgage payments and/or they are not 

currently receiving unemployment (i.e. self employed 

homeowners). 

Finally, borrowers can receive HAMP assistance prior to or after 

receiving Hardest Hit Fund assistance. For example, a borrower 

may receive UP assistance for 3-6 months and then receive MPP1 assistance for several more months, if needed. 

Once MPP-1 assistance has ended, a borrower may be eligible to 

receive a loan modification from HAMP, if needed and eligible. 

18. Program Leverage 

with Other Financial 

Resources 

None 

19. Qualify as an 

Unemployment 

Program 

 Yes ; No 
TAMPA/182364.1 

SERVICE SCHEDULE B-2

North Carolina Housing Finance Agency’s 

Mortgage Payment Program (MPP-2)

Summary Guidelines 

1. Program Overview The North Carolina Housing Finance Agency (NCHFA) 

Mortgage Payment Program (MPP-2) will provide loans to 

unemployed or substantially underemployed homeowners who, 

through no fault of their own, are financially unable to make their 

mortgage payments and are in danger of losing their homes to 

foreclosure. 

Loan proceeds will be used to pay all mortgage and mortgagerelated expenses (i.e. property taxes, homeowner insurance, 

mortgage insurance and homeowner association dues), including 

subordinate mortgage loans, until the homeowner secures 

employment or completes training for a new career. 

2. Program Goals To assist 14,100 homeowners over the next 5 years. The 

following types of assistance will be provided: 

Job Search or Short-term Assistance 

To help homeowners while they look for a new job. 

Job Training or Long-term Assistance 

To help homeowners while they complete a job training/education 

program to help secure a new job. 

Reinstatement Only or One-time Assistance

To help homeowners who have found a new job but need help to 

bring their mortgage current due to arrearages accumulated during 

a period of unemployment. 

3. Target 

Population/Areas 

Homeowners who are unemployed, or substantially 

underemployed, and/or reemployed but need help bringing their 

mortgage current. 

 

This Program will be available in all North Carolina counties. 

NCHFA will provide additional assistance over a longer period of 

time to eligible homeowners living in targeted or “hardest hit” 

counties, those with 2009 or thereafter unemployment rates 

greater than or equal to 11.3%. 

4. Program Allocation 

(Excluding 

Administrative 

Expenses) 

$282,381,786.00 
TAMPA/182364.1 

5. Borrower Eligibility 

Criteria 

Unemployed or substantially underemployed homeowners who, 

through no fault of their own, are unable to make their mortgage 

payments and are at risk of a foreclosure. Homeowners will be 

required to provide a financial hardship affidavit with appropriate 

documentation of unemployment. For most homeowners, this 

will be documentation from the Employment Security 

Commission (ESC) confirming a job loss and receipt of 

unemployment benefits. If information from ESC is unavailable, 

a notarized letter from the former employer indicating job loss 

was not the fault of the borrower will serve as a substitute. Selfemployed borrowers will be required to submit prior tax returns to 

show a loss of income. 

Employed homeowners who are delinquent due to arrearages 

accumulated during a period of unemployment but who can 

resume future payments without additional assistance. 

Satisfactory mortgage payment history. 

All principal, interest, taxes, homeowner insurance, mortgage 

insurance, homeowner association dues, and the cost of utilities 

>31% of household income after job loss/loss of income. 

Borrowers must meet program underwriting criteria. 

Eligibility for program assistance will be determined primarily by 

participating foreclosure prevention partners. 

Funds will be allocated on a first come/approved, first served 

basis. 

6. Property/Loan 

Eligibility Criteria 

Existing single-family homes, duplexes or condominiums 

(attached or detached) including manufactured homes on 

foundations permanently affixed to real estate owned by the 

borrower. 

North Carolina owner-occupied, primary residences only. 

Combined Loan-to-Value cannot exceed 125%. 

7. Program Exclusions Total Unpaid Principal Balances > $275,000. 

 

Manufactured homes not considered real property. 

Non-legal U.S. resident. 

8. Structure of 

Assistance 

10 year, 0% interest, non-recourse, deferred-payment, forgivable, 

subordinate loan. A forgiveness clause will reduce the loan 

amount by 20% a year for every year the borrower stays in the 

home after five years. At the end of the 10 years, the note will be 
TAMPA/182364.1 

considered satisfied, and NCHFA will release the lien securing the 

note. 

Loan funds are due and payable if property is sold, refinanced or 

no longer owner-occupied (unless otherwise prohibited under 

applicable federal law). Loans are repayable only from proceeds 

to the borrower from a sale or refinance. If the property is sold or 

refinanced and has not increased in equity to the degree necessary 

to fully repay the note, all or the excess portion of the note will be 

forgiven, as applicable. 

NCHFA will agree to subordinate the MPP-2 Loan for borrowers 

who refinance their mortgage(s) to receive more favorable loan 

terms. If a borrower refinances their loan to consolidate debt or 

receives cash out, the borrower would be required to repay the 

MPP-2 Loan according to the loan terms. 

All deferred, subordinate mortgages will be evidenced by a 

promissory note and secured by a deed of trust on the property. 

Borrowers will be required to sign and acknowledge the program 

guidelines with a written agreement. 

Any funds returned according to established program guidelines 

will be recaptured and used to assist additional homeowners 

through December 31, 2017. After December 31, 2017, all 

remaining and recaptured funds will be returned to Treasury. 

9. Per Household 

Assistance 

The average loan amount is expected to be $20,000 per borrower. 

Targeted Counties (2009 or thereafter Unemployment Rate ≥

11.3%): 

Maximum assistance up to $36,000 and not to exceed 36 months 

per household. 

Non-Targeted Counties (2009 Unemployment Rate < 11.3%): 

Maximum assistance up to $24,000 and not to exceed 24 months 

per household. 

10. Duration of Assistance Targeted Counties (2009 or thereafter Unemployment Rate ≥

11.3%):

Up to 36 months for those in job training/education program. 

Up to 18 months for those in a job search. 

Non-Targeted Counties (2009 Unemployment Rate < 11.3%):

Up to 24 months for those in job training/education program. 

Up to 12 months for those in a job search. 

11. Estimated Number of 

Participating 

14,100 homeowners. 

Estimated number served based on average loan amount of 
TAMPA/182364.1 

Households $20,000 per homeowner. 

12. Program Inception/ 

Duration 

Program will start after funding for MPP-1 has been obligated. 

Recaptured funds may be recycled and used in the program up 

until December 31, 2017. 

13. Program Interaction 

with Other HFA 

Programs 

Borrowers can access more than one of our HHF programs, if 

needed and appropriate. For example, a borrower can receive 

MPP-2 assistance while they look for a new job and then receive 

Second Mortgage Refinance Program or Permanent Loan 

Modification Program assistance once they secure a new job. 

14. Program Interaction 

with HAMP 

The MPP-2 would help borrowers who need more than the 3-6 

months of assistance available through the new Home Affordable 

Unemployment Program (UP), which began in August, 2010. 

Borrowers who are eligible for MPP-2 would not be required to 

participate in UP prior to receiving assistance with MPP-2. 

In addition, MPP-2 would also help borrowers who don’t qualify 

for assistance under the new UP because they are more than 3 

months behind in mortgage payments and/or they are not 

currently receiving unemployment (i.e. self-employed 

homeowners). 

Finally, borrowers can receive HAMP assistance prior to or after 

receiving Hardest Hit Fund assistance. For example, a borrower 

may receive UP assistance for 3-6 months and then receive MPP2 assistance for several more months, if needed. 

Once MPP-2 assistance has ended, a borrower may be eligible to 

receive a loan modification from HAMP, if needed and eligible. 

15. Program Leverage 

with Other Financial 

Resources 

None 

16. Qualify as an 

Unemployment 

Program 

; Yes  No 
TAMPA/182364.1 

SERVICE SCHEDULE B-3

North Carolina Housing Finance Agency’s 

Second Mortgage Refinance Program (SMRP)

Guidelines Summary 

1. Program Overview Government officials have estimated about 50% of troubled 

borrowers have a second mortgage. Homeowners are frequently 

unable to make their second mortgage payment and are in danger 

of losing their homes to foreclosure. 

The Second Mortgage Refinance Program (SMRP) will 

benefit homeowners with second mortgages who, through no fault 

of their own, are financially unable to make their mortgage 

payment because of a prior job loss, reduced income, or other 

program-eligible hardship. 

This program will provide a more affordable housing expense by 

refinancing the second mortgage to a 0%-interest, non-recourse 

deferred-payment subordinate loan. 

2. Program Goals To assist 2,000 homeowners facing foreclosure in all 100 North 

Carolina counties. 

The goal of this program is to extinguish the existing second 

mortgage and replace it with a 0%-interest, non-recourse, 

deferred-payment subordinate loan. This will reduce the 

borrower’s monthly mortgage payment and in some instances 

may expedite movement of a qualified applicant into a HAMP 

first mortgage modification process. 

3. Target Population/ 

Areas 

Our target population will be homeowners facing foreclosure in 

all 100 North Carolina counties who have a 1st and 2nd mortgage 

whereby the total mortgage payment is causing the home to be 

unaffordable under program guidelines. 

4. Program Allocation 

(Excluding 

Administrative 

Expenses) 

$30,000,000.00 

5. Borrower Eligibility 

Criteria 

Eligible homeowners must be those facing foreclosure due to 

recent unemployment, loss of income, reduction in income, or 

other demonstrated financial hardships. Homeowners will be 

required to provide a financial hardship affidavit with appropriate 

documentation on the cause of the hardship. 

Satisfactory mortgage payment history. 

All principal, interest, taxes, homeowner insurance, mortgage 

insurance, homeowner association dues, and the cost of utilities > 
TAMPA/182364.1 

31% of household income after job loss/loss of income. 

Extinguishment of second loan with SMRP will only occur if the 

first mortgage loan is current. 

Borrowers must meet program underwriting criteria. 

Funds will be allocated on a first come/approved, first served 

basis. 

6. Property/Loan 

Eligibility Criteria 

Existing single-family homes or condominiums (attached or 

detached) including manufactured homes on foundations 

permanently affixed to real estate owned by the borrower. 

Owner-occupied, primary residences only. 

Combined Loan to Value cannot exceed 125%. 

7. Program Exclusions Total Unpaid Principal Balances > $275,000. 

Manufactured homes not considered real property. 

If the homeowner is currently in a HAMP modification and the 

second mortgage is held by a 2MP servicer. 

Non-legal U.S. resident. 

8. Structure of 

Assistance 

30 year, 0%-interest, non-recourse, deferred-payment subordinate 

loan. 

Loan funds are due and payable if property is sold, refinanced or 

no longer owner-occupied (unless otherwise prohibited under 

applicable federal law). Loans are repayable only from proceeds 

to the borrower from a sale or refinance. If the property is sold 

or refinanced and has not increased in equity to the degree 

necessary to repay the note, all or a portion of the note will be 

forgiven. 

NCHFA will agree to subordinate the SMRP Loan for borrowers 

who refinance their mortgage(s) to receive more favorable loan 

terms. If a borrower receives cash out with a refinance, the 

borrower would be required to repay the SMRP Loan according 

to the loan terms. 

All deferred subordinate mortgages will be evidenced by a 

promissory note and secured by a deed of trust on the property. 

Borrowers will be required to sign and acknowledge via Written 

Agreement indicating the program guidelines and terms prior to 

refinancing the second mortgage and obtaining a subordinate loan 
TAMPA/182364.1 

under this program. 

Any funds returned according to established program guidelines 

will be recaptured and used to assist additional homeowners 

through December 31, 2017. After December 31, 2017, the funds 

will be returned to Treasury. 

9. Per Household 

Assistance 

Under this program, eligible borrowers may receive up to $30,000 

plus all related fees as a subordinate loan. 

If $30,000 is insufficient to extinguish the second mortgage, the 

Agency will only offer these funds if the second lien holder is 

willing to take the amount supplied to extinguish the debt without 

a deficiency judgment. 

10. Duration of Assistance Assistance under SMRP is a one-time payment. 

11. Estimated Number of 

Participating 

Households 

2,000 homeowners. 

12. Program Inception/ 

Duration 

The program will be available approximately in June 2011 and 

will last up to 3 years. 

13. Program Interactions 

with Other Programs 

(e.g. other HFA 

programs) 

Homeowners who participate in the Mortgage Payment Program 

(MPP) may be eligible to participate in SMRP if the borrower is 

employed and has a need. 

Eligible delinquent borrowers will be brought current with MPP 

One-Time Reinstatement if necessary and then are eligible for 

SMRP. 

14. Program Interactions 

with HAMP 

Extinguishing the second mortgage may expedite movement of 

qualified applicants into a HAMP first modification process. 

15. Program Leverage 

with Other Financial 

Resources 

If $30,000 is insufficient to extinguish the second mortgage, the 

Agency will only offer these funds if the second lien holder is 

willing to take the amount supplied to extinguish the debt without 

a deficiency judgment. 

16. Qualify as an 

Unemployment 

Program 

 Yes ; No 
TAMPA/182364.1 

SERVICE SCHEDULE B-4

North Carolina Housing Finance Agency’s 

Permanent Loan Modification Program (PLMP)

Guidelines Summary 

1. Program Overview The goal of this program is to provide a quick and streamlined 

method for modifying lst mortgage loans for homeowners whose 

mortgages have become unsustainable as the result of a program 

eligible hardship. The Permanent Loan Modification Program 

(PLMP) will provide a principal reduction with the added option 

of a rate decrease and/or term extension by the lender to achieve a 

monthly payment that does not exceed 31% of gross monthly 

household income. 

2. Program Goals To assist 440 homeowners facing foreclosure. 

The goal of the program is to decrease the number of home 

owners losing their homes to foreclosure. Secondary goals 

include stabilization of neighborhoods and protecting home 

values of surrounding properties. 

This program will provide immediate mortgage payment relief 

and stable long term mortgage payments for the life of the loan. 

3. Target Population/ 

Areas 

Homeowners suffering a program eligible financial hardship 

related to reduction of income or changed employment 

circumstances. 

This Program will be available in all North Carolina counties. 

4. Program Allocation 

(Excluding 

Administrative 

Expenses) 

$8,800,000.00 

5. Borrower Eligibility 

Criteria 

Eligible homeowners must be those with program eligible 

financial hardship due to recent unemployment, loss of income, 

reduction of income, or other demonstrated financial hardships. 

Homeowners will be required to provide a financial hardship 

affidavit with appropriate documentation on the cause of the 

hardship. 

Satisfactory mortgage payments prior to job loss, reduction in 

income or other program eligible hardship. 

Borrowers must meet program underwriting criteria. 

Funds will be allocated on a first come/approved, first served 
TAMPA/182364.1 

basis. 

6. Property/Loan 

Eligibility Criteria 

Existing single-family homes or condominiums (attached or 

detached) including manufactured homes on foundations 

permanently affixed to real estate owned by the borrower. 

North Carolina owner-occupied, primary residences only. 

Combined Loan to Value cannot exceed 125%. 

7. Program Exclusions Total Unpaid Principal Balances > $275,000 

Manufactured homes not considered real property 

Non-legal U.S. resident 

The term and rate reduction options will not be available to a 

homeowner that is eligible for HAMP. 

8. Structure of 

Assistance 

10 year, 0% interest, non-recourse, deferred-payment forgivable 

subordinate loan. A forgiveness clause will reduce the loan 

amount by 20% a year for every year the borrower stays in the 

home after five years. At the end of the 10 years the note will be 

considered satisfied and NCHFA will release the lien securing the 

note. 

Loan funds are due and payable to NCHFA if home is sold, 

refinanced or no longer owner occupied (unless otherwise 

prohibited under applicable federal law). Loans are repayable 

only from proceeds to the borrower from a sale or refinance. If 

the property is sold or refinanced and has not increased in equity 

to the degree necessary to repay the note, all or a portion of the 

note will be forgiven. 

All deferred subordinate mortgages will be evidenced by a 

promissory note and secured by a deed of trust on the property. 

Borrowers will be required to sign and acknowledge via Written 

Agreement indicating the program guidelines and terms prior to 

modifying their loan and obtaining a subordinate loan under this 

program. 

Any funds returned according to established program guidelines 

will be recaptured and used to assist additional homeowners 

through December 31, 2017. After December 31, 2017 the funds 

will be returned to Treasury. 

9. Per Household Under this program, each eligible borrower may receive up to 
TAMPA/182364.1 

Assistance $30,000 as a subordinate loan. 

10. Duration of Assistance Assistance under PLMP is a one- time payment. 

11. Estimated Number of 

Participating 

Households 

We anticipate approximately 440 homeowners will be helped. 

12. Program Inception/ 

Duration 

The program will be available approximately in September 2011 

and will last up to 3 years. 

13. Program Interactions 

with Other Programs 

(e.g. other HFA 

programs) 

Homeowners who have participated in the Mortgage Payment 

Program (MPP) may be eligible to participate in PLMP if the 

borrower has become reemployed and has a need. 

14. Program Interactions 

with HAMP 

None. 

15. Program Leverage 

with Other Financial 

Resources 

We will not require investors to match the contributions that are 

made with the Hardest Hit Funds for the Permanent Loan 

Modification Program. However, it is anticipated that certain 

original first lien providers may consider (where permitted) a 

reduction in interest income (interest rate reduction) or an 

extension of loan terms as a result of the loan modification. 

16. Qualify as an 

Unemployment 

Program 

 Yes ; No