The Wesleyan Mortgage Program

Purpose of Program

Wesleyan provides first mortgages on residential properties for the purpose of assisting and encouraging faculty, professional librarians, and administrative staff in salary grade five or higher to secure home ownership within reasonable commuting distance of the campus, subject to the conditions set forth below.

Eligibility Guidelines for a Wesleyan Mortgage

• A borrower’s financial condition must be acceptable and their appointment status must be for a three-quarter time or above position.
• Faculty, professional librarians, or administrative staff who were eligible for a Wesleyan mortgage prior to July 1, 2001 may obtain one new mortgage under the program, provided they do so prior to July 1, 2011.
• Faculty (other than visitors), professional librarians, or administrative staff in salary grade five or higher whose appointment commenced after June 30, 2001 are eligible for one Wesleyan provided mortgage during their career with the university.
• Repayment is required if the borrower ceases to be employed by the university for any reason other than retirement, no longer maintains an equity or legal interest in the property, or no longer uses the property as his or her primary residence.  When an event requiring repayment occurs the employee has up to one year to pay off the mortgage and the rate immediately increases two percent.
• If an employee becomes deceased, the spouse or qualified domestic partner of the employee can continue the mortgage at its current rate as long as he or she does not re-marry or enter a qualified domestic partner relationship.  If the spouse or qualified domestic partner is or becomes deceased or remarries or enters into a qualified domestic partner relationship, then there is a one-year period from the date of death or the date of the new marriage or partnership to pay off the mortgage and the rate immediately increases two percent.

Location of Mortgaged Residence

The mortgaged residence must be within a 25 aerial mile radius of the campus.  This circle includes New Haven and Hartford.  A map and list of localities is available on the Human Resources web site at http://www.wesleyan.edu/hr/forms

Mortgage Terms

• The maximum mortgage provided by the university is $200,000.
• The minimum down payment required is 5% of the purchase price of the house.  For houses priced in excess of $210,000, the minimum down payment required is the difference between the purchase price and $200,000.  Borrowers who are purchasing a new house and selling a house currently financed by a Wesleyan mortgage are expected to apply a significant portion (typically 80%) of the equity realized from the sale of their current house as a down payment on the purchase of the house financed by a Wesleyan mortgage.
• The interest rate charged on the loan is the local market rate minus two percentage points or nine percent, whichever is lower.  The local market rate is determined by averaging the 30-year, fixed rate, lowest origination points mortgage available at several local banks and is set quarterly.  The interest rate is fixed and will not vary during the life of the loan.
• All mortgages are in the form of a 25-year fixed rate loan.
• There are no points or loan origination fees charged to the loan.
• Mortgage payments are made by payroll deduction unless the borrower is in retirement status and no longer receiving payments from the university.
• A university mortgage is available for new construction, however the funds are not available until the house is completed and the certificate of occupancy is received.

Other Mortgage Limitations

• All owners of the mortgage premises shall be makers on the Note.
• Mortgage loans are not assumable or transferable.
• A borrower agrees to notify the university if he or she decides to sell a property in close proximity to Wesleyan’s campus.  The university might have an interest in purchasing the property and, if so, will notify the seller within thirty days.
• In the event that two otherwise eligible faculty and staff share the same residence, only one Wesleyan mortgage will be granted.

Mortgage assistance is available only for the purchase of a primary residence. Mortgage assistance is not available for:

• Home improvements or renovations, even if done at the time of the purchase of the home.
• Re-financing of current mortgages or for mortgage financing where no current mortgage exists or for loans where the Wesleyan employee owns less than a 50% interest in the mortgaged premises.
• The acquisition of investment property, including a multi-family house even if occupied by a Wesleyan employee.
• The university may, at its discretion, sell the mortgage to another financial institution.  If this happens, the purchaser of the mortgage is not allowed under federal regulations to change any of the conditions and requirements of the mortgage.

The Application Process

The loan application will be processed and reviewed by Liberty Bank of Connecticut at its Middletown, Connecticut office, 55 High Street.  The telephone number is (860) 344-7314.  The borrower will pay the processing costs including underwriting and appraisal fees and the cost of a credit report.  The borrower will also be responsible for other typical mortgage loan requirements including, but not necessarily limited to: title insurance, property insurance, pest and other inspections, attorney fees (for both themselves and the university), and recording fees.