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Mortgage Origination Program

Mortgage Origination Program

THERE IS AN ACTIVE CAMPUSWIDE PAUSE ON MOP/SHLP

For years, demand for the variable-rate MOP/SHLP program was minimal because market interest rates were extremely low and banks offered fixed-rate mortgages that were attractive to new home buyers.  Over the past 18 months, market interest rates have grown less favorable, leading to newfound demand for MOP/SHLP.

Given this change, program funding has temporarily been exhausted. We do not have a confirmed timeline for replenishment, although we do know that the current shortage is temporary (and likely to be less than one year). We should know more in the new calendar year and will continue to release program status and details to faculty, recruits, and departments as specifics become available.

Impacted faculty/recruits who hold current MOP/SHLP authorizations have been notified by the campus Home Loan Coordinator and further information has been provided to each College/School/Department.

Incoming eligible title codes can still request nomination from their respective departments, but nominations will be held at the department level until the pause is lifted.

We know this news is disruptive to those eligible for the MOP/SHLP program, and we hope to provide a positive update soon.

Click to read up on program information

Program information

The Mortgage Origination Program, or MOP, was created by the University of California to offset the negative impact of California housing prices by providing competitive first mortgages to eligible Davis faculty and senior management to assist them in the purchase of a principal residence near their campus.

Information on the active UC Davis-wide pause on MOP/SHLP
  • In escrow with MOP: will not impact employee’s ability to close on contracted property.
  • In possession of pre-approval MOP documents from UCOP: will not affect your current pre-approval.  Unable to renew your pre-approval past its current expiration date.
  • With active MOP authorization: on hold given lack of UC Davis MOP funds.
  • New MOP Inquiries: on hold given lack of UC Davis MOP funds.

Eligibility

The eligible population for the program consists of full-time university appointees who:

  • Hold senior management positions; or
  • Are members of the Academic Senate; or
  • Hold academic titles equivalent to titles held by Academic Senate members; or
  • Hold the title of Acting Assistant Professor
  • For incoming international employees, have a visa specific to UC Davis and a Social Security Number or Individual Taxpayer Identification Number prior to starting loan application process
  • Apply within two years of initial appointment start date.
  • Do not currently own, and have not, within the 12-month period preceding the issuance of the loan, owned another property within a reasonable distance (i.e. within a 90-mile radius) of the campus.
  • MOP/SHLP participation is subject to availability of funding
  • Program participation and policies are subject to change at any time
Loan Pre-Approval

Borrower must have pre-approval PRIOR to entering the contract to buy a home.

Property Guidelines

  • Maximum borrowing amount of $1,200,000.
  • Property must be purchased within 90 miles of Davis.
  • Properties must be owner-occupied and must be a single-family residence (including condominiums and units within planned unit developments).
  • Property must be the participant's principal place of residence.
  • Property must be used primarily for residential non-income producing purposes.
  • Property must be 50% or more participant owned.
  • Property on more than one acre will be appraised for the home and one acre only with the MOP loan restricted to not more than 90% of this appraised value.
  • Property must be occupied by the eligible MOP borrower no more than 60 days after the close of escrow.
Loan Position

MOP loans must be secured on the property by a first deed of trust.

Loan Types

Standard MOP loan

  • A 30-year adjustable-rate mortgage and charge no points, lender fees or private mortgage insurance. 
    View the current interest rate for these loans on the Office of the President website.
  • Fully amortized with terms up to 30 years.
  • The interest rate is adjusted annually, on the anniversary date of the promissory note. The base rate will be adjusted up or down, to a maximum of 1% annually, to the most recently available four-quarter average of the STIP index. To derive at a new interest rate, the administrative fee of .25% will be added to this adjusted base rate.
  • The MOP loan has an interest rate cap of 10% over the start rate.
  • Assumability: Loans under this program are not assumable.
  • Repayment: Monthly repayment is made through payroll deduction. Repayment in full is required six months after separation from the university unless separation is due to retirement or disability.
  • Prepayment: MOP loans carry no prepayment penalties.

5/1 MOP

  • A 5-year fixed rate/25 year adjustable-rate loan. Details on the 5/1 MOP loan is available on the Office of the President website.
  • Fully amortized with terms up to 30 years.
  • The interest rate is adjusted annually, on the anniversary date of the promissory note. The base rate will be adjusted up or down, to a maximum of 1% annually (with an interest rate cap of 10% over the start rate), to the most recently available four-quarter average of the STIP index. To derive at a new interest rate, the administrative fee of .25% will be added to this adjusted base rate.
  • The MOP loan has an interest rate cap of 10% over the start rate.
  • Assumability: Loans under this program are not assumable.
  • Repayment: Monthly repayment is made through payroll deduction. Repayment in full is required six months after separation from the university unless separation is due to retirement or disability.
  • Prepayment: MOP loans carry no prepayment penalties.

 

Tags

Home Loan Program