FirstHome Conventional Product Summary

The OHCS FirstHome loan product provides first mortgage financing and down payment/closing cost assistance to eligible mortgagors. This product was created to help fulfill OHCS’ mission to provide housing opportunities to individuals and families with low to moderate incomes.

• The OHCS FirstHome product provides first mortgage financing with an optional second mortgage OHCS down payment assistance (DPA) product.
• This product summary is a complement to and not a substitute for first mortgage product guidelines.
• First lien agency guidelines apply except as modified by this product summary for the purpose of this product only.

• This guideline manual was last updated Aug. 15, 2026.
• Learn more information about the FirstHome product.
  
• Have questions? Please email HCS_HomeownershipLending@hcs.oregon.gov
  
• View assistance with printing pages of this manual.
  

Entity Identification Number

EIN: 93-0952117

Available Markets

Properties in Oregon

Eligible Lenders

Lenders must be approved by OHCS / Idaho Housing and Finance Association (IHFA) to participate in the OHCS FirstHome loan product.

Interested lenders should contact OHCS at HCS_homeownershiplending@hcs.oregon.gov.

Originating Lender

OHCS requires the loan originating staff (loan officers, loan officer assistants, processors) to be in Oregon or within 50 miles of the Oregon border.

Master Servicer and Compliance Agent

Product Administrator / Compliance Agent
Hilltop Securities Inc.
15301 Ventura Blvd., Bldg. B, Suite 410
Sherman Oaks, CA 91403
310-401-8052
Email: OregonFlexLendingHelp@hilltopsecurities.com

Master Servicer
Idaho Housing and Finance Association
565 W. Myrtle St.
Boise, ID 83702
208-331-4700
Email: HOL-shipping@ihfa.org

Loan Purpose

Purchase money first mortgage lien on primary owner-occupied residence. Optional DPA is available.

First Mortgage Products

Government Products - All 30-Year Fixed-Rate

• FHA
• FHA Section 184
• VA
• USDA-RD

Interest Rates/Loan Reservations

Hilltop Securities Inc. will post mortgage interest rates by 9 a.m. (PT) daily. Current rates can be found on the following websites:

• https://oregonlendingprograms.com
• OHCS FirstHome Lenders page

Sign up for email rates distribution.

Announcements

The lock window will be available from 9 a.m. to 4 p.m. (PT), Monday through Friday, except for holidays and certain days when the financial markets are closed.

All loans must be delivered to and purchased by IHFA within 60 days of rate lock.

One-time extension may be purchased at the following rates: (* % of the loan amount).

Changes to existing rate locks are to be emailed to OregonFlexLendinghelp@HilltopSecurities.com.

Interest rate buydowns are not available under the FirstHome product.

Discount points are not allowed under the FirstHome product.

Interest credits are allowed up to seven days with a maximum amount of $1,000.

Homebuyer Education

Homebuyer education is required for all first-time homebuyers. Homebuyers must complete Homebuyer Education through an OHCS homeownership center.

Find participating homeownership centers.

Arrive Homeownership (formerly known as Portland Housing Center) is an accepted homeownership counseling center.

Lender must retain a copy of the completion certificate for the course or counseling in the loan file.

Homebuyer education certificate is good for up to one year.

Please note: If unable to coordinate class through a local homeownership center, borrowers may use the "Finally Home" online homebuyer education class or Framework Homebuyer Education by Neighborworks.

First-Time Homebuyer

A first-time homebuyer is defined as an individual who has not owned or occupied a principal residence in the past three years preceding the closing date of the mortgage.

All borrowers must be a first-time homebuyer, unless they meet an exception as noted below:

• The subject property is in a targeted area.
• Veterans who use a one-time exemption:
  
• Utilized when the borrower is a qualified veteran buying a property in a non-targeted area and who is not otherwise considered a first-time homebuyer.
• One-time use means a veteran who has not previously had a mortgage financed through a mortgage revenue bond or a mortgage credit certificate (MCC) program.
• The qualified veteran must fully execute form SFMP7-VA at closing.
• Borrowers who have an ownership interest in:
• Bare land
• A manufactured home classified as personal property

IRS Documentation Requirements

• Standard: Three years of most recent signed federal tax returns for all files
• Exceptions: Most recent signed federal tax return for the following:
• Targeted properties
• Veterans using their one-time exemption
• Tax return transcripts or record of account transcripts in lieu of signed federal tax returns are acceptable.

Other OHCS Documentation Requirements

• Fraud report
• Credit report

Other Ownership Interests

At loan cloasing, borrowers must not hold ownership in any additional real estate, with the exception of bare land or a manufactured home classified as personal property.

Household Size

Household size includes all household members occupying the home:

• All persons who will live in the subject property, related and unrelated
• Persons who are full-time household occupants
• Children who are away at school but home during break
• Children who are part of a joint custody arrangement that are in household more than 50% of the time
• Married borrowers whose spouse is not living with them must provide court-ordered divorce or legal separation papers. Without these, spousal income will be included in household income.

Occupancy Requirements

• Borrower must occupy property within 60 days of closing.
• Mortgagor must live in the property as their principal residence.
• At no time during the course of the mortgage shall the property be used as or converted to an investment property or second home or be tenant occupied.
• No more than 15% of the total area of the subject property may be used in a trade or business activities.
• Properties must be accessible year-round regardless of location.

Income Limits/Annual Gross Household Income (AGHI)

The annual gross income of all household and family members age 18 and over must not exceed the income limits established by the department pursuant to Section 143 of the Code of 1986, as amended, and published annually by the U.S. Department of Housing and Urban Development (HUD). Refer to U.S. Code of Federal Regulations 24 CFR Section 5.609 – Annual income and Section 143(f) of the code, as amended.

• Annual gross household income (AGHI) is the anticipated (future) income for the 12 months following the mortgage loan closing.
• Annualized gross household income is defined as the borrower’s gross monthly household income multiplied by 12.
• The income of all individuals occupying the property 18 years or older (related and unrelated) must be included in the calculation of annualized gross household income.
• Married borrowers whose spouse is not living with them must provide court-ordered divorce or legal separation papers. Without these, spousal income will be included in household income.
• Income limits are based on county, household size, and targeted and non-targeted areas.
• FirstHome non-targeted area income limits
• FirstHome targeted area income limits

Income Documentation Requirements

Borrowers

W-2 earners

• One year of signed federal tax returns
• Paystubs covering the most recent 30-day period dated within 120 days of closing
• Written VOE

Other income earners (does not include self-employed)

• One year of signed federal tax returns
• Current award letter or other documentation that verifies income

Self-employed

• Signed federal tax returns (personal and business) for the most current year, and
• Current P&L statement is required.
• Self-employed income is calculated according to agency guidelines using the most current tax year.
• If federal tax returns are not available, the borrower must complete and sign the form SFMP 27. In addition, transcripts showing "no record of return" provided.

Household members

W-2 earners

• Paystubs covering the most recent 30-day period dated within 120 days of closing, or
• Written VOE

Other income earners (does not include self-employed)

• One year of signed federal tax returns, or
• Current award letter or other documentation

Self-employed

• Signed federal tax returns (personal and business) for the most current year
• Self-employed income is calculated according to agency guidelines using the most current tax year.
• If federal tax returns are not available, the household member must provide a letter of explanation with reason for no filed federal tax returns.

Please see full list of required documents on post-closing income compliance review worksheet.

Federal Tax Return Requirement

The signed federal tax return requirement for household income compliance is different and is often confused with the three-year first-time homebuyer federal tax return requirement. Federal tax returns are required for two reasons for FirstHome. Both requirements must be met. See below for a breakdown.

1. First-time homebuyer compliance

Requires three years of signed federal tax returns for all borrowers listed on the loan application. This applies to all FirstHome loans.

Exceptions to the first-time homebuyer requirement:

• Buyers are purchasing a home in a targeted area. This requires one year of signed federal tax returns.
• Buyer is an eligible veteran using their one-time Veteran’s Exemption. This requires one year of signed federal tax returns and the veteran to execute form SFMP7-VA.

2. Annual Gross Household Income (AGHI) compliance

Income compliance is not based on a three-year historical tax return review, and household income should not be calculated over a three-year period.

Most current year of signed federal tax returns are required for all borrowers; household members to provide signed federal tax returns if self-employed or other type of income that can be verified from tax returns.

Borrowers who do not file federal tax returns must provide a signed SFMP 27 and transcripts showing "no record of return."

Household members who do not file federal tax returns must provide a letter of explanation for no filed returns.

See the "Income Documentation Requirements" section for specific requirements.

Borrower Eligibility

An eligible borrower and/or eligible co-borrower purchasing a singlefamily residence in a non-targeted area may not have held a present ownership interest in a principal residence at any time during the preceding three-year period ending on the date the mortgage is executed.

If an eligible borrower is purchasing a single-family residence located within the boundaries of a targeted area, the three-year prior ownership restriction does not apply.

The borrower must be a first-time homebuyer, the property must be in a targeted area, or the borrower qualifies as an exempt veteran. An exempt veteran is someone who has not had a bond loan or MIC loan in any of the 50 states. Borrower to provide DD214 or certificate of eligibility to confirm veteran status.

Borrower must meet household income limits.

Residency: The borrower must be a resident or intend to become a resident of Oregon. Follow agency guidance for U.S. citizenship requirements.

Non-occupying cosigners are not permitted.

Non-occupying coborrowers are not permitted.

Borrowers may not own any residential property at the time of closing.

Underwriting/Credit Score/Debt Ratio

Lenders are responsible for all credit underwriting decisions on all conventional mortgage loans originated under the program.

Mortgage loans must be underwritten to the standards of the applicable loan type.

Mortgage loans may be underwritten through an Automated Underwriting System (AUS), Fannie Mae’s Desktop Underwriter (DU), or Freddie Mac’s Loan Prospector (LP).

Freddie Mac HFA Advantage and Fannie Mac HFA Preferred Loans must meet the guidelines of the department’s servicer and applicable agency and all other guides listed in this summary.

All borrowers who have a credit score must have a minimum score of 620 for mortgage loans underwritten using AUS (Automated Underwriting Systems).

Borrowers without a credit score are eligible only when the loan receives an AUS Approve recommendation and all applicable agency requirements are met.

Borrowers with frozen credit files are eligible only when the loan receives an AUS Approve recommendation and all agency guidelines for evaluating frozen credit are followed.

Manual Underwriting

Manual underwriting is not allowed.

Interested Party Contributions

Interested party contributions, follow agency guidelines.

Impounds

All loans require impounds regardless of LTV.

Property Types

Allowed:

• One-unit primary residence
• Condominiums
• Townhomes and planned unit developments (PUDs)
• Manufactured housing (includes single- and multi-wide) classified as real property
• Leasehold
• Community land trust

Not Allowed:

• Co-ops
• Second homes and investment properties
• Two- to four-unit properties
• Properties with accessory dwelling units (ADU)
• Manufactured homes classified as personal property

Purchase Price Limits

Loan is subject to the maximum purchase price per county. These limits are determined based on IRS requirements.

Housing Stability Council – Mortgage loans equal to or greater than 95% of the local area purchase price limit must be approved by the Housing Stability Council prior to the department purchasing the mortgage loan.

Targeted Areas

Targeted areas are federally designated areas of slow economic growth where you do not have to meet the first-time homebuyer requirement to qualify for the programs.

Find targeted areas by determining the Census tract, and then verifying the targeted area by county.

Find a list of Oregon's targeted areas.

Recapture Tax

Recapture tax does apply. Borrowers are encouraged to speak to a tax professional for guidance.

Appraisal

A full interior/exterior appraisal is required and must comply with mortgage program appraisal guidelines.

AUS approval with appraisal waiver is acceptable.

Escrow Holdbacks

Allowed - see Lender Notice 2025.04 for details. Follow all agency requirements. Lender notices.

Title/Vesting

Vesting - Ownership vesting must be held by the eligible borrower, not in trust or in an LLC.

Non-borrowing spouse (NBS) is allowed on title with the following requirements met:

• Judgment/lien search for NBS on title report
• Evidence NBS has not had ownership in principal residence in the past three years.
• Evidence NBS does not currently have ownership in real estate.
  Please note: A soft-pull credit report for the NBS will be needed to determine eligibility.
  

Hazard/Flood Insurance

Hazard and flood insurance must comply with the requirements of the department’s servicer.

Maximum hazard deductible is $2,000. Maximum flood deductible is $5,000.

Down Payment Assistance (OHCS)

The OHCS down payment / closing cost assistance is in the form of a second lien that is a forgivable or a repayable second lien.

The assistance is based on the total loan amount (first lien amount plus any upfront MIP, funding fees, etc.).

Income tier is based on county.

Qualifying income is used to determine the down payment assistance (DPA) income tier, which determines the loan term for the second mortgage.

Please note: Certain options may not always be available depending on the market.

Learn more about DPA area median income (AMI) tiers

DPA funds may be used for up to 100% of the borrower’s cash requirement to close, including down payment, closing costs, pre-paid items, upfront borrower-paid mortgage insurance and other related mortgage loan fees and expenses.

The borrower may not receive cash back at close with exception to earnest money deposit (EMD) and prepaid items.

Any unused DPA funds must be applied to the loan principal of the first mortgage. Principal reduction amount cannot exceed 1% of the loan amount.

Lenders fund the DPA at closing, on behalf of OHCS, and will be reimbursed the DPA assistance minus applicable fees upon purchase of the loan by Idaho Housing.

DPA/second lien must be recorded in second position behind the first mortgage.

Note: DPA may not be used to pay the difference between the sales price and appraised value if the sales price is higher (gap financing).

The Focused Demographics Option offers 5% DPA for borrowers who meet the following criteria:

• FirstHome program guidelines, and
• Two of the four criteria below:
1. Household of four or more
2. Household member with a disability
3. Front-end ratio of 28% or higher
4. Sole Head of Household with at least one eligible dependent living in the household (eligible dependents below):
1. Under 18
2. A household member with a disability
3. Age 62 or older
   

Note: Household must include only one adult that is not an eligible dependent. All other household members must be eligible dependents.

Second Mortgage (DPA from Previous Section)

The Forgivable Second Mortgage is for borrowers whose AMI is ≤80%. The loan will be due and payable if the property is sold, refinanced or transferred. See "Repayment" below.

The Repayable Second Mortgage has an interest rate 1% above the interest rate of the first mortgage for a term of 10, 20, or 30 years and is payable monthly beginning the first full month after closing. The repayable second mortgage is for borrowers whose AMI is greater than 80%.

Note: DPA/second lien must be recorded in second position behind the first mortgage.

Repayment

The outstanding balance of the loan is repayable if any of the following events occur prior to loan term or maturity date:

Sale or Transfer

If all or any part of the property, or any interest in the property (including a beneficial interest), is sold, conveyed, or transferred, whether voluntary, involuntary or by operation of law.

Refinance or Payoff

Refinancing or paying off the first mortgage.

Rental of Property

If borrower rents or leases (whether by written or oral agreement) the property or any portion of the property.

Failure to Occupy Property as Principal Residence

If borrower fails to occupy the property as the borrower’s principal residence for a period of more than 60 days.

Default or Acceleration

Upon acceleration of the first or second loan for any reason.

There is no forgiveness for partial months.

Allowable Fees/Lender Compensation

In addition to the standard fees normally charged to the borrower and determined by the lender (i.e., Appraisal Fee, Credit Report Fee, Flood Certification, Underwriting, Document Preparation, etc.) the following fees should also be included.

• Origination charges are allowed according to agency guidelines.
• Please list fees in accordance with TRID guidelines on the LE/CD.
  
• The IHFA fees will be netted out of the loan purchase price.
• No fees are allowed to be charged on the second mortgage except for recording fees and interest, if applicable.

Service Release Premium – All Loans at Purchase - 1.25%

Compliance review fee should not be sent from title but rather netted back to lender for ACH payment through HilltopPay.

Mortgage Insurers (MI)

The following MI companies are approved:

• Arch
• Enact
• Essent
• MGIC
• National MI
• Radian

MI rates, pricing, and guidelines may differ among the participating MIs and are subject to change.

Lenders should consult the current housing finance agency MI guidelines at each MI company to determine the terms and conditions by which such loans will be insured.

These product guidelines do not supersede, nor are they a substitute for, the guidelines in place with each mortgage insurer at the time the loan is underwritten.

Mortgage Insurance/Coverage Amount

• Borrower-paid – monthly with annual renewal
  
• Split premium
  
• Single premium
• The lender-paid mortgage insurance option is not allowed.

Financed MI is allowed; however, there is a gross LTV cap of 97%, which includes the financed MI amount.

MI Activation

Lender is responsible for activating any MI policy and remitting any MI payments due to the mortgage insurer prior to the sale of the loan to Idaho Housing.

The lender is also responsible for transferring the MI policy to IHFA after the loan sale.

MERS Assignments

Lender must use MERS (1009670) to register and assign the first and second mortgages to Idaho Housing.

The notes for the first and second mortgages will be in the lender's name.

Loan Funding

At closing, lenders must fund the following in their own name:

• First mortgage loans
• The DPA assistance on behalf of OHCS

Hilltop Securities Compliance Review

Pre-Closing

All loans must be compliance approved pre-closing to ensure the product criteria have been met, as well as post-closing compliance review of final executed documents.

Pre-Closing Checklist:

• First Lien Underwriter Transmittal Summary - 1008 (Conv), 92900LT (FHA), Loan Analysis (VA)
• Applicable agency AUS findings
• Initial and final (unsigned) first lien 1003/URLA
• Borrower fraud report
• Borrower credit report
• Executed Purchase Contract w/Addendums
• Federal tax returns:
• Three years of federal tax returns for all loan files, or
• One year of federal tax returns for qualifying veterans or properties in a targeted area
• Homebuyer education course certification for all first-time homebuyers
• Other program specific-documents such as the second lien LE or Focused Worksheet, depending on the program chosen
• Pre-Closing Borrower's Acknowledgment Form - signed. Note: At closing, borrower will sign a final copy reaffirming their understanding of the terms.
• SFMP 7-VA - Veteran Exemption Certification (if applicable)
• SFMP 8 Demographic Data
• SFMP 11 Representation, warranties, and certification for hazard insurance
• SFMP 16 Notice to Buyers
• SFMP 25 Notice to Borrower Regarding Recapture provision
• SFMP 27 Statement of income tax filing (if applicable)
• Income and Household Member Disclosure
  

Post-Closing

Post-Closing Checklist:

• The Checklist
• Executed final closing disclosures first lien and/or second lien (depending on the product)
• Executed final URLAs (lender, borrower, and any addendums)
• Executed Second Mortgage Subordinate Deed of Trust
• Executed Second Mortgage Note
• Executed Legally Enforceable Obligation Letter
• Executed Reaffirmation - Borrower’s Acknowledgement Form.
  Note: Borrower is reaffirming their understanding of the terms.
• Electronic submission of the HTS compliance file to Oregon Lending Programs.
• No original documents should be sent to the Hilltop Securities team.
• HTS, OHCS, and IHFA files must be cleared and approved for loan purchase.
  

Loan Purchase and Servicing

• All loan credit files will be electronically submitted to Idaho Housing and Finance Association via Lender Portal.
• IHFA will purchase the first and second mortgage loans at a rate and price reflected on the mortgage commitment confirmation, less any fees, plus the applicable service release premium (SRP).
• Original notes endorsed to Idaho Housing and Finance Association and Signature Affidavit delivered to:
  Idaho Housing and Finance Association
  565 W. Myrtle St.
  Boise, ID 83702
• Original notes and final loan package delivered within 10 days of closing.
• Documents delivered electronically in the Lender Connection web portal.
• Lender Connection loan information completed online.
• Original recorded mortgages, including all original riders and assignment, if applicable, delivered within 90 days to:
  Idaho Housing and Finance Association
  565 W. Myrtle St.
  Boise, ID 83702
• Final title policy uploaded to Lender Connection within 90 days of purchase.
• Insurance certificate, if applicable (FHA, MIC/VA LGC/USDA-RD LNG), uploaded within 15 days of purchase.
  Idaho Housing and Finance Association
  Phone: 800-526-7145
  Email: LoanPurchase@ihfa.org

OHCS Household Income Compliance Review (Post-Closing)

• All FirstHome loans are required to have an income compliance review by OHCS to validate that the loan meets IRS requirements.
• Lender is responsible for providing the following documentation to OHCS within 10 days after closing to ensure program requirements have been met.
• Loan will be eligible for purchase after the compliance review has been completed, and all requirements are met.

The following documents will need to be uploaded to the Lender Portal under the OHCS Income Compliance File:

Borrowers (as applicable)

• Written Verification of Employment (WVOE) with income verification *Required
• 30 days of consecutive paystubs dated within 120 days of closing *Required
• SSI/Disability Award Letters
• Pension/Retirement/Annuity Statements
• Child Support or Alimony Received (Divorce Decree or Court Order)
• Current one year of signed federal tax returns (personal and business) - all pages (schedules and statements) *Required
• Year-to-date P&L statements for self-employed borrowers
• Underwriter total household income calculation worksheets

Household members (as applicable)