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NP Program Guidelines

The following publications specify how eligible nonprofit agencies may apply for FHA approval and to:

  1. Act as a mortgagor using FHA mortgage insurance
  2. Purchase HUD homes at a discount
  3. Provide secondary financing; See "Application information for secondary financing/downpayment assistance providers."

HUD issued the following mortgagee letters (MLs) relating to nonprofit programs:

(1) ML 01-30 Clarification of Net Development Cost Calculation; Expansion of the Use of the Net Development Cost Calculation and Land Use Restriction Addendum to Properties Sold at a Discount of 10 percent or more; Program Definitions; and List of Relevant Documents;  with the following attachments:

(2) ML 02-01 New Requirements and Restrictions and the following attachments:

NOTE: In 02-01, the addresses for the Denver Homeownership Center and the Santa Ana Homeownership Center have recently changed.  Always check the HUD Homeownership Centers web page.

Some instructions in the preceding letters, 01-30 and 02-01, supersede the instructions in the following letter,  00-08, however, for your convenience, here are the contents of ML 00-08:

(3) ML 00-08 Nonprofit Agency Participation in Single Family FHA Activities and the following attachments in ZIP format:

  • Application Package for Nonprofit Agency for FHA Activities
  • Affordable Housing Program Format for Narrative
  • Agency Reporting Requirements and FHA Monitoring Activities
  • Agency Recertification Requirements and Reasons for Removal from List of Approved NP Agencies
  • Recertification for NP Agencies - Property Listing Format
  • Mortgagee Responsibility for the Credit Evaluation of the Nonprofit Borrower

HUD published a Federal Register Notice, "Nonprofit Organization Participation in Certain FHA Single Family Activities; Placement and Removal Procedures" on 06/06/02 providing information to nonprofit agencies seeking FHA approval.

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