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PRINTER'S NO. 1462
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1235
Session of
2017
INTRODUCED BY DAWKINS, YOUNGBLOOD, DAVIS, KINSEY, DRISCOLL,
SOLOMON, D. COSTA, V. BROWN, ROEBUCK AND McCLINTON,
APRIL 17, 2017
REFERRED TO COMMITTEE ON URBAN AFFAIRS, APRIL 17, 2017
AN ACT
Amending the act of December 3, 1959 (P.L.1688, No.621),
entitled, as amended, "An act to promote the health, safety
and welfare of the people of the Commonwealth by broadening
the market for housing for persons and families of low and
moderate income and alleviating shortages thereof, and by
assisting in the provision of housing for elderly persons
through the creation of the Pennsylvania Housing Finance
Agency as a public corporation and government
instrumentality; providing for the organization, membership
and administration of the agency, prescribing its general
powers and duties and the manner in which its funds are kept
and audited, empowering the agency to make housing loans to
qualified mortgagors upon the security of insured and
uninsured mortgages, defining qualified mortgagors and
providing for priorities among tenants in certain instances,
prescribing interest rates and other terms of housing loans,
permitting the agency to acquire real or personal property,
permitting the agency to make agreements with financial
institutions and Federal agencies, providing for the purchase
by persons of low and moderate income of housing units, and
approving the sale of housing units, permitting the agency to
sell housing loans, providing for the promulgation of
regulations and forms by the agency, prescribing penalties
for furnishing false information, empowering the agency to
borrow money upon its own credit by the issuance and sale of
bonds and notes and by giving security therefor, permitting
the refunding, redemption and purchase of such obligations by
the agency, prescribing remedies of holders of such bonds and
notes, exempting bonds and notes of the agency, the income
therefrom, and the income and revenues of the agency from
taxation, except transfer, death and gift taxes; making such
bonds and notes legal investments for certain purposes; and
indicating how the act shall become effective," providing for
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Pennsylvania College Graduate Homeowner Program.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of December 3, 1959 (P.L.1688, No.621),
known as the Housing Finance Agency Law, is amended by adding an
article to read:
ARTICLE IV-E
PENNSYLVANIA COLLEGE GRADUATE HOMEOWNER PROGRAM
Section 401-E. Definitions.
The following words and phrases when used in this article
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Eligible applicant." An individual who:
(1) Is a graduate of an eligible postsecondary
institution.
(2) Has student loan debt.
(3) Applies for financial assistance from the agency
under this article.
(4) Has graduated from the eligible postsecondary
institution within three years of filing the application.
(5) Satisfies the eligibility criteria for the financial
assistance as established by the agency.
"Eligible postsecondary institution." Any of the following:
(1) An institution of higher education that is
designated State-related by the Commonwealth.
(2) A university within the State System of Higher
Education.
(3) A community college operating under Article XIX-A of
the act of March 10, 1949 (P.L.30, No.14), known as the
Public School Code of 1949.
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"Program." The Pennsylvania College Graduate Homeowner
Program established under this article.
"Residential dwelling." A premises, regardless of its market
value, that is located in this Commonwealth and is occupied as a
residence by an individual.
"Student loan debt." Debt incurred by an individual for
attending an eligible postsecondary institution, which debt is
at least $1,000 and not more than 15% of the purchase price for
a residential dwelling to be purchased by the individual through
the program and which debt is in repayment or deferred status.
Section 402-E. Establishment of program.
The Pennsylvania College Graduate Homeowner Program is
established in the agency. The program shall provide financial
assistance to an eligible applicant as follows:
(1) The eligible applicant must provide evidence
satisfactory to the agency that:
(i) The eligible applicant has not previously
purchased a residential dwelling.
(ii) The eligible applicant intends to purchase a
residential dwelling.
(iii) The eligible applicant will own and occupy the
residential dwelling.
(iv) The eligible applicant has been approved for a
loan from a financial institution for the purchase of the
residential dwelling.
(2) The agency shall pay off the eligible applicant's
student loan debt at the time of settlement on the
residential dwelling.
(3) At settlement, the eligible applicant shall execute
and deliver to the agency a note and second mortgage on the
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residential dwelling in the amount of the student loan debt.
The duration of the note shall be five years and the interest
rate shall be 0% with no monthly payments. The agency shall
prescribe other terms and conditions for the note and second
mortgage.
(4) Each year during the five-year period that commences
on the first anniversary date on which the note is executed,
the agency shall forgive 20% of the amount borrowed on the
note if the eligible applicant continues to own the
residential dwelling and has not paid off the first mortgage
or refinanced the amount owed on the residential dwelling.
Section 403-E. Regulations.
The agency shall promulgate regulations to implement and
administer the program.
Section 2. This act shall take effect in 60 days.
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