[Code of Federal Regulations]

[Title 24, Volume 4]

[Revised as of April 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 24CFR904.108]



[Page 312]

 

                 TITLE 24--HOUSING AND URBAN DEVELOPMENT

 

CHAPTER IX--OFFICE OF ASSISTANT SECRETARY FOR PUBLIC AND INDIAN HOUSING, 

               DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

 

PART 904_LOW RENT HOUSING HOMEOWNERSHIP OPPORTUNITIES--Table of Contents

 

                Subpart B_Turnkey III Program Description

 

Sec.  904.108  Break-even amount.



    (a) Definition. The term ``break-even amount'' as used herein means 

the minimum average monthly amount required to provide funds for the 

items listed in the illustration below. A separate break-even amount 

shall be established for each size and type of dwelling unit, as well as 

for the Project as a whole. The break-even amount for EHPA and NRMR will 

vary by size and type of dwelling unit; similar variations as to other 

line items may be made if the LHA deems this equitable.



    Illustration. The following is an illustration of the computation of 

the break-even amount based upon hypothetical amounts.



(1) Operating Expense (see Sec.   904.109):

  Administration.......................................   $8.50

  Homebuyer services...................................    2.00

  Project supplied utilities...........................    3.00

  Routine maintenance--common property.................    3.00

  Protective services..................................    2.00

  General expense......................................    6.50

  Nonroutine maintenance--common property (Contribution    2.00   $27.00

   to operating reserve)...............................

(2) Earned Home Payments Account (see Sec.   904.110)..  ......    12.00

(3) Nonroutine Maintenance Reserve (see Sec.   904.111)  ......     7.50

Break-Even Amount......................................  ......    46.50







The break-even amount does not include the monthly allowance for 

utilities which the homebuyer pays for directly, nor does it include any 

amount for debt service on the Project notes.



    (b) Excess over break-even. When the homebuyer's required monthly 

payment (see Sec.  904.107(j)) exceeds the applicable break-even amount, 

the excess shall constitute additional Project income and shall be 

deposited and used in the same manner as other Project income.

    (c) Deficit in monthly payment. When the homebuyer's required 

monthly payment is less than the applicable break-even amount, the 

deficit shall be applied as a reduction of that portion of the monthly 

payment designated for operating expense (i. e., as a reduction of 

Project income). In all such cases, the EHPA and the NRMR shall be 

credited with the amount included in the break-even amount for these 

accounts.