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Investment Accounts Such as Stocks, Bonds, Saving Certificates, and Money Market Funds <br />Interest or dividends earned by investment accounts are counted as actual income from assets <br />even when the earnings are reinvested. The cash value of such an asset is determined by <br />deducting from the market value any broker fees, penalties for early withdrawal, or other costs of <br />converting the asset to cash. <br />SAHA Policy <br />In determining the market value of an investment account, SAHA will use the value of <br />the account on the most recent investment report. <br />How anticipated income from an investment account will be calculated depends on <br />whether the rate of return is known. <br />For assets that are held in an investment account with a known rate of return (e.g., <br />savings certificates), asset income will be calculated based on that known rate <br />(market value multiplied by rate of earnings). <br />When the anticipated rate of return is not known (e.g., stocks), SAHA will <br />calculate asset income based on the earnings for the most recent reporting period. <br />Equity in Real Property or Other Capital Investments <br />Equity (cash value) in a property or other capital asset is the estimated current market value of <br />the asset less the unpaid balance on all loans secured by the asset and reasonable costs (such as <br />broker fees) that would be incurred in selling the asset [HCV GB, p. 5-25]. <br />SAHA Policy <br />In determining the equity, SAHA will determine market value by examining recent sales <br />of at least three properties in the surrounding or similar neighborhood that possess <br />comparable factors that affect market value. <br />SAHA will first use the payoff amount for the loan (mortgage) as the unpaid balance to <br />calculate equity. If the payoff amount is not available, SAHA will use the basic loan <br />balance information to deduct from the market value in the equity calculation. <br />Equity in real property and other capital investments is considered in the calculation of asset <br />income except for the following types of assets: <br /> Equity accounts in HUD homeownership programs [24 CFR5.603(b)] <br /> The value of a home currently being purchased with assistance under the HCV program <br />Homeownership Option for the first 10 years after the purchase date of the home [24 CFR <br />5.603(b), Notice PIH 2012-3] <br /> Equity in owner-occupied cooperatives and manufactured homes in which the family lives <br />[HCV GB, p. 5-25] <br /> Equity in real property when a family member’s main occupation is real estate [HCV GB, p. <br />5-25]. This real estate is considered a business asset, and income related to this asset will be <br />calculated as described in section 6-I.F. <br />EXHIBIT 1