What types of homes can be purchased through the Gateway Neighborhood Fund?

The homes must be:

  • Single family (no duplexes or apartment buildings)

  • Owner-occupied

  • Located in the City of St. Louis

  • Ineligible for a traditional mortgage because of the appraisal gap issue

 

What does it take to qualify?

  • A credit score of 620

  • 3% down payment, $1,000 of which must be provided by the borrower, if you have down payment assistance this can be used towards the remaining downpayment)

  • Last 2 paystubs and tax returns from the 2 previous years

 

What is the interest rate?

The Gateway Neighborhood Fund is made up of 2 mortgages. The first mortgage covers the appraised value of the home and the second mortgage covers the amount above the appraised value. The interest rate for the first mortgage is .25% over prime and the second mortgage’s interest rate is 1.25% over prime.

 

What is the term length of the mortgage?

20 years max, no prepayment penalty.

 

I already own a home, can the GNF be used to renovate?

The Gateway Neighborhood Fund can be used to finance renovations on owner-occupied homes that have issues securing a traditional Home Equity Loan, due to low valuations.

 

If I’ve owned a home before and I have a good credit score, do I have to complete homebuyer education?

Yes, all Gateway Neighborhood Fund borrowers need to complete a High Loan-to-Value education class.

 

I’d like to buy a house from the City; I heard they have cheap houses available for rehabilitation. How do I find out about these types of houses?

The Land Reutilization Authority manages the city’s real estate listings. You can search available properties at: https://www.stlouis-mo.gov/government/departments/sldc/real-estate/lra-owned-property-search.cfm

 

Are there income restrictions?

No, there are no income restrictions to qualify for the Gateway Neighborhood Fund.

 

Another bank already turned me down because the house didn’t appraise high enough for the mortgage, will I qualify?

This is what the Gateway Neighborhood Fund was designed for. If you meet the other requirements, you will likely qualify for a mortgage through the Gateway Neighborhood Fund.

 

Can I qualify even if I don’t qualify for a conventional loan because I have poor credit, no down payment, or a high debt to income ratio?

Possibly. All applicants will be screened to determine if they qualify. Although some applicants will meet the guidelines immediately, if your qualifications do not quite meet the guidelines, the credit coaches at Justine PETERSEN will work with you to get you on a path to approvability.

 

Is there a maximum on home loan amount and/or renovation amount?

There is no maximum on the first mortgage, but the first mortgage can only be up to the appraised amount (post-renovations, where applicable).

The second mortgage has a maximum of $75,000.

 

What renovations are allowed under the Gateway Neighborhood Fund?

Acceptable repairs include roof, plumbing, and electrical repairs, ramps, weatherization, repairs that address code violations, HVAC, windows, and tree trimming.

Unacceptable repairs include appliances. 

 

Is there down payment assistance?

We do not currently have a down payment program of our own. However, if you receive down payment assistance through another source you may put it towards your down payment.

 

Is a homebuyer’s class required for renovation loans? Does it cost anything?

Yes, all borrowers, including renovation loan borrowers, need to complete a High Loan-to-Value Education class offered through Justine PETERSEN.  There is no charge for the class.

 

How can I contribute to the Gateway Neighborhood Fund?

Please contact us if you are interested in contributing to the Gateway Neighborhood Fund.

 

Can someone come speak to my community group about this mortgage product?

Yes, please contact us to request a presentation!

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