State home-loan program offers low rates
Published 12:00 am Friday, September 18, 2015
A bond-financed program from the Oregon Housing and Community Services Department has $77 million to lend first-time homebuyers at low interest rates.
The Oregon Bond Loan so far this year approved 207 mortgage loans across the state, 11 in Central Oregon. Last year, the program approved 382 loans statewide, 16 of them in Central Oregon. Housing and Community Services works with participating lenders to make the loans.
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“We just actually put out another (bond) offering,” said Alison McIntosh, communications liaison for Housing and Community Services. “Now is the time to apply.”
The State Housing Council on Friday approved a loan for a homebuyer in Redmond. But the program has not attracted many homebuyers in Central Oregon recently because banks and other lenders offered interest rates as low as the program rates, said Lynne McConnell, an associate director with NeighborImpact. The nonprofit works with homebuyers to help them find homes and finance their purchases.
“It’s hard for the state to compete in that way,” she said Monday. “Now that rates are starting to tick up a little bit, (the Bond Loan program) is becoming more attractive.”
The state offers two programs: a 3.25 percent interest rate for its RateAdvantage Home Loan and a 3.75 percent rate on its CashAdvantage Home Loan. The RateAdvantage loan offers a below-market interest rate on a mortgage loan. The CashAdvantage provides cash assistance up to 3 percent of the loan amount and a relatively low mortgage interest rate.
By comparison, bank rates on conventional mortgages advertised online Monday ranged from 3.75 percent from JPMorgan Chase & Co. for a 30-year, fixed-rate mortgage to 4 percent from Bank of America and 4.135 percent from Wells Fargo.
Applicants to the state bond program must meet income qualifications. In Deschutes County, that means a combined maximum annual income of $74,065 for up to two people, or $85,175 for three or more in a household. In both Crook and Jefferson counties, the limits are $60,700 for households of up to two people and $70,700 for three or more.
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The state defines “first-time homebuyer” as someone who has not owned and occupied a primary residence in the three years prior to signing a mortgage and note. However, some counties, Crook and Jefferson included, are “targeted areas,” where the first-time definition is waived and the applicant has transferred any previously owned property prior to closing the loan, according to www.oregonbond.us.
— Reporter: 541-617-7815, jditzler@bendbulletin.com