Proposals seek more homebuyers

Financing programs an effort to bolster `aging' communities

`Innovative ways'

Rules on eligibility, loans would be eased

council OK needed

November 23, 1999|By Larry Carson | Larry Carson,SUN STAFF

Homebuyers in Howard County's older neighborhoods may soon find it easier to get government-aided mortgage financing, thanks to Robey administration efforts to bolster those communities.

Proposed changes would ease restrictions and broaden the reach of financing programs.

The family-income eligibility ceiling would increase to $65,000 from $48,000. Loans would be available for homes costing up to $171,475, compared with the top price now of $155,000.

Programs limited to first-time homebuyers also would expand to include any buyers in certain areas. In addition, more help would be available for down payments and closing costs, said Leonard Vaughan, county housing and community development administrator.

"It is time to find innovative ways to make owning a home in Howard County affordable for our children and our public servants," County Executive James N. Robey said of the proposals, which require County Council approval. "We hope these new homebuyers, many of whom grew up here, will become our catalyst for the rebirth of aging communities."

Under the expanded programs, preference would be given those who live or work in Howard County.

Vaughan said the county wants to help increase homeownership and reduce rentals in older neighborhoods.

"We want to target those people to areas that have shown some decline or an increase in the number of rental units," Vaughan said. Many renters already pay as much as a mortgage payment would cost under the programs, he said.

The county has converted 37 rentals to owner-occupied homes in the past several years, Vaughan said, by using Howard's portion of $40 million in state money that provides 4 percent mortgage loans.

The county's proposed homeownership programs also fit with Maryland's Smart Growth initiative and the county's desire to prevent blight in older areas as new homes blanket the countryside.

Money to finance the county programs will come from $300,000 in federal block-grant funds and an estimated $3.9 million in state funding.

In addition, "borderline" applicants -- some with minor credit history blemishes -- could get money for a down payment through the Homeowners Expense Loan Program, and up to $6,000 to help pay Maryland's high closing costs. The money would be repaid when the house is sold.

Some people, Vaughan said, may have one late rent payment on their credit history, which may cause problems obtaining a conventional mortgage. The county can help by assuming part of the risk for up to two years, giving buyers time to prove they can make payments on time.

"We know what we need to do -- encourage investment in our existing communities," Vaughan said, adding that neighborhoods for the programs will be selected later.

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