SRAP
The Small Rental Assistance Program Video Transcript
This is a presentation about the SRA program that is being offered in the Mississippi GO Zone. This is a program that is Federally funded and directed by the Mississippi Development Authority. The purpose of this program is to make housing affordable for everyone, especially during these times of high rental demand. It is a five-year commitment with the government for this program. One of the most common questions I get is how do I qualify for this program and what are they looking for? In the next few minutes we will cover this in detail.
The SRA Program is only offered in 4 Mississippi counties. It is Federally funded with 262.5 Million left at the MDA’s discression, which they chose to allocate by county in rounds.
So how much is this incentive actually worth to you? For a duplex if you get approved your incentive is $73,000! For new property that is placed into rental service money is awarded by the number of bedrooms. For our duplex, which is 3 bedrooms and 2 baths it is $27,500 per side plus a completion bonus of $9,000 per side, which we hit in contract.
As stated, a duplex qualifies for $73,000. There are guild lines that must follow to comply with the program. For a duplex on side has to be rented to someone who is 80% of median income, while the other side must be rented to someone who is 120% of median income. This is a forgivable loan, which is no principle and no interest paid back as long as you follow the guidelines. The loan term is 5 years and the balance is forgiven in thirds, so after year 3 a 1/3 is forgiven. After year 4 another 1/3 is forgiven and the final amount is forgiven after year 5.
Qualification for the program is on a point based system. They want to see your financial capacity and history along with credit score. Having landlord experience also helps. Mississippi residents are favored, however, due to a strong rental culture and credit issues from Katrina several residents are limited to ownership, increasing the rental pool. The property itself must also comply with FEMA building standards. We also score full points on the home by carrying energy efficient appliances.
The money form the program is rewarded in 3 separate payments. The first half can be applied for once the building permits are issued. The other half may be applied for after the certificate of occupancy is issued. After the home is completed you may put in for the 6-month completion bonus.
