Information for Lenders and Escrow Officers

SUBORDINATION REQUESTS on Mayor's Office of Housing and Community Development (MOHCD) Units

MOHCD only accepts subordination requests originated from Approved Lending OfficersPlease click here for Information for Lender Workshops/Training.

Effective July 1, 2017 - Loan Subordination/Refinance Application Fee (non-refundable) $601

The subordination application package must be submitted ELECTRONICALLY through the Database of Affordable Housing Listings, Information, and Applications (DAHLIA) system.


Thank you for your interest in working with the Mayor's Office of Housing and Community Development (MOHCD). Much of the information regarding refinance/subordination, payoff, workshop and fees can be found on this page. You may also want to visit our Homebuyer page for more detailed information on individual loan programs we offer to assist prospective homebuyers.


What is Needed for Subordination Requests:

  • We only accept subordination request packages originated from Approved Lending Officers, except for LEAD grants, Rehab and released Condo Conversion loans. For brokers, the funding lender also needs to be approved. We will decline a subordination request if the lending officer is not on our Approved Lending Officers List.
  • Lenders/Escrow Officers must submit all required loan documents outlined on the PDF iconMOHCD Subordination Request Package Dec 2016. Completed packages take 7-10 business days to process. If a package is received incomplete, the file is suspended, and the requestor is notified. The requestor is given 48 hours to comply before the file is subject to cancellation.
  • A non-refundable "Program Administration Fee", in either cashier or escrow check, made payable to the City and County of San Francisco. The fee must be delivered to our office by mail or in person within 48 hours of the subordination submittal. We do not accept personal checks. Click HERE for Program Service Fees.

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Here are links to subordination request items in general:

Please note that:

  • Due to the large volume of requests we are receiving, current processing time for subordination requests is 7-10 business days. We cannot begin processing an application until we receive all required documents. The request is then processed in order by date of complete application.
  • The approval criteria may vary based on program requirements and restrictions. Review the Subordination Policy Statement for the general guidelines. Review the Subordination Request Checklist for the required documents. MOHCD may request additional information before making a decision. MOHCD reserves the right to deny a subordination request.
  • The lender is required to determine that there is a net tangible benefit on all applicable rate and term refinance transactions by completing the Net Tangible Benefit Worksheet. Net tangible benefit is defined as either: a) A reduction of at least 5% in the mortgage payment and recapture of closing costs within 48 months; or b) A reduction in the term of the mortgage provided the payment increase is less than 15%. The Net Tangible Benefit Worksheet shall be used as a tool by the lender for purposes of the reasonable, tangible net benefit analysis.
  • No cash out transactions: a) Cash back proceeds. All refinance proceeds must be applied as a principal-reduction payment to the new 1st mortgage; and b) Buy-down/impound balances. If the payoff the 1st mortgage has a remaining interest rate buy-down balance or impound balances current in escrow, those monies must be applied to the payoff balance at close of escrow and may not be refunded to the Borrower.
  • Refinancing within 12 months after purchase may be approved only on a case by case basis.
  • Repayment of the City’s cash loans (e.g. BMR DALP, DALP, FRDALP, TND, PIC, MALP and Rehab) may be required on a refinance with an increase of monthly mortgage payment if: a) the current appraised value of the subject property is sufficient to support a combined 1st and City cash loan, and b) the borrower can obtain an affordable loan from a lender supporting the amount.
  • Borrowers with CalHOME loans: the term of the new senior lien must be at least for the period of time remaining on the CalHome loan. It must mature concurrently or after the CalHome lien, due to Program restrictions.
  • Starting April 1, 2009, refinancing borrowers for BMR, DALP, FRDALP, City 2nd, PIC, TND and MALP programs must work with one of our Approved Lending Officers. Starting July 1, 2012, refinancing former-SFRA borrowers must also work with one of our Approved Lending Officers, for us to consider approval.
  • Starting July 1, 2013, Mayor's Office of Housing and Community Development is implementing an annual increase in Program Administration Fees. Please always check our website for the current fees.
  • Click HERE to find answers to the most frequently asked questions (FAQs) on subordination requests.
  • For details regarding specific City loan programs, please refer to their corresponding Loan Information webpage. They are listed under "Assistance for First-Time Homebuyers".
  • Regarding Home Equity Line of Credit (HELOC):
    MOHCD does not allow Home Equity Line of Credit (HELOC). This policy is in place to protect homeowners with MOHCD loans/liens. HELOCs typically involve variable interest rate rather than fixed rate. A variable interest rate loan financing is not allowed by MOHCD.
  • Regarding "Home Equity Loan" on BMR units:
    Owners of Below-Market Rate (BMR) units administered by MOHCD must contact MOHCD and receive approval, before applying for a home equity loan. The BMR homeowner must attend a Post-Purchase Counseling class from a participating HUD-approved non-profit housing counseling agency prior to applying for such a loan. MOHCD may consider home equity loan requests for the following reasons: capital improvements to the home; educational expenses of a household member; medical expenses of the owner or the owner's immediate family member; and funds required to implement a marriage dissolution agreement or domestic partnership dissolution agreement. All other MOHCD underwriting guidelines must be met, including debt-to-income and loan-to-value ratios.


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MOHCD Loans can be paid off before the loan term ends. To request a payoff, please provide the following to MOHCD:

  1. A WRITTEN Payoff Request from borrower(s), or a signed consent from borrower(s). See PDF iconLoan Pay-off Request Form.
  2. Borrowers must complete IRS Form W-9.
  3. A full interior and exterior appraisal dated within the past 90 days (see the appraisal requirements below) or ratified purchase agreement, if the City loan belongs to DALP, FRDALP, SFRA or City 2nd Programs. An appraisal is not required on BMR DALP loan as the payoff amount will be calculated based on the BMR unit resale restricted price determined by MOHCD at time of repayment.
  4. Appraisal is NOT required for City Rehab loans/liens, such as LEAD, CHRP, and CalHOME.

Please note that the BMR lien CANNOT be paid off. In addition, certain City restrictions may still apply after the City loan is paid off. For example, the "Right of First Refusal" requirement will remain on City 2nd properties after payoff.  Please refer to specific MOHCD Programs for details.

Appraisal Requirements: For purposes of determining the appraised value, MOHCD requires a fair market appraisal to be completed to Uniform Standards of Professional Appraisal Practice standards by qualified appraisers holding a California Certified Appraisal License (AR - Certified Residential License or AG – Certified General License, issued by the Office of Real Estate Appraisers), preferably with a "MAI" member of the American Institute of Real Estate Appraisers or an "SRPA" member of the Society of Real Estate Appraisers (or any such equivalent designations), and with experience appraising similar properties in the San Francisco Area. The City has the option, at its sole expense, to select an appraiser to conduct an additional appraisal of the property. If the two appraisals are not in agreement as to the appraised value of the property, the amounts determined by the appraisals will be averaged to determine the appraised value of the property for the purpose of payoff calculation.

To find an appraiser on Appraisal Institute, please click HERE.


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Services For...

(as of 7/1/17)

Downpayment Loan Assistance Program (DALP)*

Processing, Review, Underwriting and Preparation of Loan Documents


City 2nd (CSLP)*

Processing, Review, Underwriting and Preparation of Loan Documents


Mortgage Credit Certificate (MCC)

Application Processing


Loans Combined with MCC*

Loan Applications (*, above) Combined and Submitted with MCC Application


Refinance MCC



Loan Subordination/Refinance




Lender Initial (Participation Fee)



Lender Renewal (Participation Fee)