HOME Replacement Reserve Account Guidelines for Use
June 08, 2021
The replacement reserve account is established by the borrower(s) at the time of the HOME loan closing and must be maintained for the entire 20-year affordability period. AHFA has established specific requirements for the replacement reserve accounts to safeguard the availability of funds for capital needs as the project will require for maintaining a viable project throughout the 20-year affordability period.
No withdrawals may be requested within the first 60 months after the AHFA HOME loan has closed.
A request for withdrawal will be approved or denied by written notification to the owner or management company within 30 days of receipt of the request.
A request for withdrawal may not be made more than 120 days after the invoice date.
A single withdrawal may not draw the reserve balance below a balance equal to 12 months of reserve deposits as specified in the HOME Commitment/Written Agreement.
If a single item request exceeds $5,000, an inspection may be done prior to the release of funds.
The owner will make all requests using the Replacement Reserve Withdrawal Request Form. The management company may prepare the form, but the form must have the owner’s signature to be considered valid and complete.
At least two bids must be provided for all materials and/or work performed, excluding the purchase of household appliances.
Reserve requests related to repair items which result from a tenant-related incident(s) must be supported with documentation regarding the tenant’s collected or uncollected security deposit and the of the use of the deposit toward the amount of the reserve request.
If any approved withdrawals from the account are subsequently found to be misrepresented, incomplete or excessive, the owner will be required to reimburse the reserve account.