AHP Modernization

January 1, 2020 Implementation

The Final AHP Rule necessitates the following significant changes effective January 1, 2020 for certain owner-occupied units receiving subsidy awarded through the competitive AHP and to the Set-aside Program(s), known within FHLBank Chicago's District as the Downpayment Plus^® Program (DPP^®). These changes, applicable to one or both programs, are summarized below. 

1. In order to participate in the 2020 DPP programs, member institutions must submit a new Program Agreement, even if the member participated in the 2019 DPP programs.The Program Agreement must be signed by an authorized signatory of the member institution.
2. Retention agreements for rehabilitation-only owner-occupied units, awarded through the competitive AHP, will no longer be allowed. Furthermore, any outstanding retention agreements for rehabilitation-only owner-occupied units are not enforceable. 
3. The retention agreement used in Illinois and Wisconsin has been updated. This new retention agreement is required for 1) all acquisition-only and acquisition/rehabilitation competitive AHP homeownership units completed on or after January 1, 2020, even if the grant is being funded from an earlier program year and 2) all DPP-assisted loan closings on or after January 1, 2020, even if the DPP grant is being funded from the 2019 program year. Since this retention agreement is used in Illinois and Wisconsin only, please review and update any retention agreements used for other states. 
4. The repayment worksheet has been updated to reflect:
   • The new net proceeds calculation,
   • A de minimis exception to subsidy repayment when the amount is subject to repayment is $2,500 or less, and
   • The use of a proxy method based on sales price to determine whether the subsequent homebuyer is a low- or moderate-income household. This may result in an exception to repayment.

We encourage members and sponsors to review our brief recorded video providing guidance on how to complete the repayment worksheet. Members and sponsors may also refer to the instructions tab of the repayment worksheet.

Summary of the Final AHP Rule

Please see below for a summary of the significant changes effective January 1, 2021. If you would like more details, check out our Final AHP Rule presentation.

These reflect only select changes to the AHP regulations and is not a complete analysis of the Final AHP Rule.