Neighborhood Stabilization Frequently Asked Questions

What is the NSP FTHB Program?
The Neighborhood Stabilization Program offers gap financing and closing cost assistance to purchase an NSP City owned home.

How can I apply for NSP?
First get prequalified by a mortgage lender, fill out the NSP application and meet the income guidelines for the program; that is that your total household income cannot exceed 120% of the area’s median income; Example: A family of four at 120% can have a maximum income of $69,500.

How much do I need out of pocket to purchase an NSP home?
A qualified NSP buyer may purchase an NSP home for as little as 1% of the purchase price. Additionally each FTHB will need to pay all or a portion of the closing cost.

What is the percentage rate on a NSP loan?
Three percent (3%) interest rate for 30 years with a 5 year deferral for NSP1.

How do I know how much house payment I can qualify for?
When a lender qualifies you for a mortgage, they take into consideration other factors such as your income, expenses and existing debt.

Who can buy a house through NSP?
Several factors contribute to one’s ability to purchase an NSP home. The most important is that the buyer’s income be at or below 120% AMI and not owned a home, rental, land, or gone through foreclosure within the last three years.

Do I need a realtor to purchase an NSP home?
Yes, all buyers are required to purchase an NSP home. Your realtor will assist you in completing the purchase contract and in making sure that the process of purchasing an NSP home goes without problems.

After I’ve read through everything and still have questions, who should I call?
You can contact the City of Merced Housing Division at (209) 385-6863.