Wilkes University has established an Employer Assisted Housing (EAH) program to aid in the revitalization of neighborhoods in and around campus and throughout the City of Wilkes-Barre. This benefit is extended to all full-time employees who have successfully completed ninety (90) calendar days of service. If a husband and wife are both eligible employees of Wilkes University, only (1) one loan will be made available.
Eligible employees can receive a forgivable loan on a “primary” residence of either $5,000 or $10,000, depending on location within the City of Wilkes-Barre, which can be used to defray down payment, closing or points on the purchase in the eligible areas. Please contact the Human Resources Development Office for questions regarding property location.
The entire loan is provided to the employee at the time of purchase. The Program is funded with $40,000 annually for all forgivable loans within the program. Loans are offered to employees on a first-come, first served basis.
Loan forgiveness/Tax Consequences
The University will forgive 20% of the loan each year over a five year period of employment from the issuance date of the loan. Employees who leave the University prior to the conclusion of the five-year period are responsible for reimbursing the University for any outstanding funds due. Any compensation due to employee by the University at the time employment ends will be used to offset any outstanding funds due. Loan forgiveness may have tax consequences and the employee is responsible for any and all taxes.
For example, assume that an employee closes on the purchase of a home in the eligible area on September 1, 2006 and that he/she is eligible for $10,000 loan amount. July 1st will be considered the anniversary date of the forgivable loan. On July 1, 2007, the University will forgive $2,000 (20%) of the loan assuming that the employee fulfills all conditions of the program. That $2,000 will appear as income to the employee on the W-2 he/she receives from the University for 2007. It is subject to FICA and all other withholding taxes. The University will forgive $2,000 (20%) again on July 1, 2008 and each year thereafter until 2012. These amounts would appear on the employee’s W-2 form each year respectively.
Forgivable home purchase loan applications are available through Human Resources Development Office or via their website at www.wilkes.edu. A completed application also requires that you attach a copy of a fully executed property purchase contract and complete mortgage lender application.
Employees who are just starting to look for a home in the City of Wilkes-Barre can request a Conditional Reservation for one of the Forgivable Home Purchase Loans that are available each year. If approved, employees can use a Conditional Reservation with lenders to certify that down payment support is available through the Wilkes EAH program. Conditional Reservations expire 90 days after the initial approval. Employees must complete and submit a Forgivable Home Purchase Loan Application with all necessary attachments and information.
The University has collaborated with Citizens Bank, Wachovia Bank, PNC Bank, M&T Bank and FCNB Bank in an effort to ensure that employees receive favorable interest rates, which is available to all employees, even outside eligible areas. Please contact the Human Resource Development Office for current arrangements and partners.
In addition, various Homeowner programs, initiatives and information sessions are available thru the Federal, State and Local governments.
Policy No. 386 Issued 08/25/2006
Policy No. 386 Effective Date: 8/25/2006