Skip to main content

 

How to Apply to the MPDU Sales Program

eSubscription

Frequently asked questions

Summary of Steps for Applying to the MPDU Homeownership Program

MPDU Homeownership Program - Description

Montgomery County's Moderately Priced Dwelling Unit (MPDU) Program offers affordably priced townhomes and condominiums - both new and resale - to first-time home-buyers who have a moderate household income (see list of minimum and maximum income levels below).

MPDU buyers must be able to qualify for a mortgage; pay a down payment; pay settlement fees including advance taxes and advance insurance; and pay a monthly mortgage payment, utilities, and other costs.  The MPDU Program does not provide financing to purchase MPDUs.  Special financing and down payment and closing cost assistance are available through the Housing Opportunities Commission.

MPDU owners are responsible for all home maintenance, home improvements, condo and homeowner association fees (if applicable), and compliance with homeowner or condominium rules and regulations. 

Program Rules

Homes that are purchased through the MPDU Program, whether new or re-sale, have controls on them.  All new MPDUs, and some resale homes, have 30 year controls; a very few resale homes have 15 year controls. These controls are in the form of a legal document, known as MPDU restrictive covenants that states:

  • During the control period, the owner must occupy the home as his or her primary residence.  The unit may not be rented out.  The owner must certify before taking occupancy that he or she will occupy the unit as his or her primary residence during the control period.
  • During the control period, the owner must not refinance the property for more than the controlled resale price established by the MPDU office (owners are prohibited from refinancing the property based on the market value of the property).
  • During the control period, the owner can only sell their MPDU at the MPDU established controlled resale price through the MPDU Program.
  • During the control period, MPDU owners must not purchase another property in the Washington Metropolitan area.
  • When the MPDU is sold after the control period, the owner may sell the unit at a market price and must pay 50% of the excess profit to Montgomery County. For more information  see Requesting a Shared Profit Calculation.  
  • After the control period expires, it is strongly recommended that owners contact the MPDU office prior to refinancing their MPDU.  Refinancing does not relieve the owner of the obligation to make a shared profit payment to the County upon sale; therefore, it is important not to refinance for the full market value. The MPDU office can provide you with an estimate of the shared profit payment that would be owed to the County. 

Benefits of MPDU Home Ownership

  • MPDU purchasers own a home in Montgomery County at a greatly reduced price.  Living in Montgomery County provides access to high quality services and schools.
  • By purchasing an MPDU home with a standard 30-year fixed rate mortgage, the MPDU owner’s monthly mortgage payment will not increase each year, unlike rent which landlords typically increase annually.
  • MPDU owners are able to deduct mortgage interest and real estate taxes from their income tax.
  • Property taxes are based on the MPDU value of the MPDU, not a "market value."
  • MPDU owners have the freedom to make improvements to their home.  (Note, however, that only certain improvements can be credited toward the resale price of an MPDU.)
  • The maximum resale price for an MPDU home during the control period is what the MPDU owner originally paid for the MPDU, plus inflation and the cost of eligible improvements.

Who Is Eligible?

  1. You are NOT eligible to participate in the MPDU purchase program if you currently own a house or have owned a house anywhere in the past five (5) years.
  2. Income Minimums and Maximums (all incomes are gross household income; that is, household income before taxes)
    • minimum annual household income: $35,000
    • maximum annual household income (effective April 14,, 2017):
       
      Eligible Household Size
      and Maximum Income
      Household Size

      Maximum Income

      1

      $54,000

      2

      $62,000

      3

      $69,500

      4

      $77,000

      5

      $83,500

      6

      $89,500

      7

      $95,500

      8

      $102,000

  3. Participants in the MPDU purchase program MUST be able to:
    • pay a down payment, settlement fees and other closing costs, and
    • afford the monthly mortgage and other expenses for the property.
  4. Financing.  Applicants for the MPDU purchase program must provide a mortgage pre-qualification letter from an HOC approved Mortgage Lender in an amount of at least $120,000.  The MPDU Program does not provide financing.  Special financing and down payment and closing cost assistance are also available through the Housing Opportunities Commission (HOC).
  5. The primary applicant in a household for an MPDU must be a permanent resident of the United States.  The applicant must certify that they are a U.S. citizen, or are a lawful permanent resident (a green card holder).
  6. All adult wage earners in a household must be able to provide a copy of their U.S. Federal Tax Return for the most recent filing year.

How to Apply - Easy as 1...2...3!

Step 1:  Attend First-Time Home-Buyer Class

Step 2:  Attend MPDU Orientation Seminar

Step 3:  Attend MPDU Application Session

  • The MPDU Program does not mail applications for the MPDU purchase program. New, first-time home-buyers in the MPDU program need to attend the first two required training sessions (Steps 1 and 2) in order to receive an application to participate in the MPDU program.  They must then attend an Application Session (Step 3) to turn in their completed application.
  • These classes are designed to answer all questions about the MPDU program, provide information about the MPDU purchase application and selection process, and provide information about home ownership responsibilities.
  • Current participants in the MPDU Program who have already taken the first two classes and who have already received a Certificate of Eligibility do not need to take the first two classes again - however, they must still attend an MPDU Application Session (Step 3) to turn in their renewal application and supporting documents.

Note:  Incomplete applications will not be accepted.  Applicants must not sign up for the MPDU Application Session until they:

  • attend a First-Time Home-Buyer Class,
  • attend the MPDU Orientation Seminar,
  • obtain a mortgage pre-qualification letter from an HOC approved lender,
  • gather all other documents needed for the application (as identified in the application folder), and
  • complete and sign the MPDU application.
Steps and Instructions
Step Instruction

Step 1:

Attend a First-Time Home-Buyer Class

Montgomery County has arranged for Housing and Community Initiatives (HCI) to conduct First Time Homebuyer classes for the MPDU program. These home-buyer classes are held in the Council Office Building (COB) an average of three (3) times per month.

Click here to sign up for a Montgomery County MPDU sponsored First-Time Home-Buyer Class.

Note:  It is important to arrive on time for these sessions. If you arrive late, you will not be able to attend the class and you must reschedule. After completing this class, you will receive a First-Time Home-Buyer Class Certificate of Completion.

The MPDU program will accept a Certificate of Completion from another first-time homebuyer class, but only if the class:

  • Has been taken within the previous two years,
  • Is conducted by a nonprofit housing counseling agency certified by the U. S. Department of Housing and Urban Development (HUD) (you must provide documentation that the organization is HUD certified), and
  • Is conducted in person (is not an online-workshop) and is at least three hours long.

Several groups provide First-Time Homebuyer classes in Montgomery County, including:

Step 2:

Attend an MPDU Orientation Seminar

Attend an MPDU Orientation Seminar where you will learn about the program benefits, application and selection processes, and program rules.  You must take the First Time Homebuyer Class before the Orientation Seminar.  These MPDU Orientation Seminars are generally held once per month in the Council Office Building (COB).

Click here to sign up for an MPDU Orientation Seminar.

Note:  It is important to arrive on time for these sessions. If you arrive late, you will not be able to attend the seminar and you will have to reschedule. After completing this seminar, you will receive the Application packet for the MPDU sales program.

Step 3:

Attend an MPDU Application Session

The final step in the application process is to attend an MPDU Application Session. MPDU Application Sessions are held twice a month at the MPDU Office and last approximately one hour. At the Application Session, your completed application and supporting documents will be reviewed and processed. Parking for the application session is available in the building garage in the basement. The entrance to the parking is at the right side of the building. Parking is free after the ticket is validated after the end of the session.

Click here to sign up for an MPDU Application Session.

At the MPDU Application Session, you must provide ALL of the following documentation (applications with incomplete documentation will not be accepted):

  1. The completed MPDU Application form; which is given to you upon completion of the MPDU Orientation Seminar.
  2. The First-Time Home-Buyer Class Certificate of Completion form; which is given to you upon completion of the First-Time Homebuyer's Class.
  3. A mortgage Pre-Qualification Letter. Your prequalifying letter must be from an approved HOC lender and in the format required or your application will not be accepted.  Please ensure the lender letter you are providing is the original.  Copies will not be accepted.
  4. A copy of your most recent tax return along with W-2 forms.
  5. If your taxes do not show your current address and you are seeking a priority point for living in Montgomery County, proof of residency (lease, utility bill, etc.).
  6. Copies of the two most recent pay stubs for each household wage earner.
  7. Any other documents required for your application, as indicated in your application packet.

Applicants must keep copies of all documents turned in at the application session. Montgomery County budget restrictions prohibit the MPDU office from making copies.

 

Go Top