New $31 million bond issue to help homeowners

The Louisiana Housing Finance Agency has approved a $31 million bond issue to fund its Mortgage Revenue Bond Assisted Program.

The program will use the money to fund 30-year, fixed rate loans at 6.625 percent with up to 4 percent of the loan amount in down payment and closing cost assistance. Using the program, a loan amount of $150,000 would result in a grant of $6,000 applied toward the down payment and closing costs of the home.

All 64 parishes in the state have been targeted for this bond issue, which means that the first-time homebuyer rules have been waived. Those rules would normally disqualify a homeowner who has owned a home within the last three years.
To be eligible for the state bond subsidy, the applicant must be qualified for a Federal Housing Administration, Veterans Affairs, Rural Development or Conventional loan, which requires proof of a stable income and average to good credit. Income limits do apply, and in St. Charles Parish the total annual household income for a family of three or more must not exceed $83,720.

In addition to that program, the Low Rate Program got $3.5 million to offer 30-year mortgages with a fixed rate of 6 percent.  There is also a HOME/MRB Program that combines the bond money with HOME funds from the U.S. Department of Housing and Urban Development. That program offers 30-year mortgage loans at 5 percent, with 4.5 percent to 9 percent in down payment and closing cost assistance.

Julie Otillio, of Boutte-based AmCor Mortgage, applauds the new measures taken by the state.

“We have embraced the state bond programs and FHA financing and coordinated joint marketing efforts with interested agents who agree with our strategy,” she said. “As the pendulum started to change in the beginning of 2007, and financing options began to be eliminated, we started to promote such good choices with the help of our realtor partners.”

All of the above programs are available only to families who are buying a home, not to those seeking to refinance an existing high-interest mortgage.