First-time home buyers can access MHDC loans at 5.9%

The Missouri Housing Development Commission is making available its Mortgage Revenue Bond first-time home buyer loan at 5.9 percent, effective immediately, according to a news release from the MHDC.

"This new rate will make buying a home affordable for an even larger number of Missourians," said Mark Stalsworth, homeownership production manager, in the release.

The new rate applies to conventional loans as well as loans backed by Fannie Mae, the Federal Housing Administration, the U.S. Veterans Administration and the U.S. Department of Agriculture. MHDC loans are made on 30-year, fixed-rate terms.

With some exceptions, only first-time home buyers may participate in the program. A qualified first-time home buyer (and spouse) cannot have had an ownership interest in a primary residence for the past three years, the release stated.

Low-income families will also qualify for down payment assistance from MHDC in the form of the Cash Assistance Program. Those receiving CAP assistance will pay a slightly higher mortgage rate of 6.67 percent. This cash assistance of 4 percent of the loan amount does not have to be repaid and may be applied at closing to a portion of the closing costs, prepaid taxes, insurance premiums, down payment and other expenses.

In cooperation with about 60 banks and mortgage companies serving the state of Missouri, MHDC funds loans for low-income and moderate-income families that seek to buy houses in the state. Except in some rural counties and inner-city areas, the funds are restricted to first-time home buyers.

The exception is for home buyers purchasing homes in targeted areas. Federally targeted areas include parts of the following counties in Missouri: Adair, Barry, Benton, Boone, Buchanan, Butler, Camden, Cape Girardeau, Clay, Dunklin, Greene, Hickory, Howell, Jackson, Jasper, Laclede, Marion, Morgan, Oregon, Pemiscot, Pettis, Ripley, St. Louis City, St. Louis County, Scott, Texas, Wayne and Wright.

Participating lenders offer information on what areas are available.

Loan eligibility in a non-target area is limited to a one- to two-person household with a total gross income below $44,300 or below $50,945 for a household with three persons or more. In a target area, a one- or two-person household income should not exceed $53,160 and a three- or more person household income should be less than $62,020.

The total gross annual household income is based on income for all residents age 18 or older living, or intending to live, in the home.

Eligible loans include FHA, BA, Rural Development or Fannie Mae-qualified 30-year conventional.

Area lenders participating in MHDC first-time home buyer programs include Great Southern Bank in Branson, Joplin, Neosho and Springfield; NationsBank of Southwest Missouri in Carthage, Joplin, Neosho and Springfield; United Missouri Bank of Carthage; Norwest Mortgage in Joplin and Springfield; First State Bank of Purdy in Monett; and Chase Manhattan Mortgage, Countrywide Home Loans Inc., Delmar Financial Co., Farris Mortgage, Liberty Bank, Mercantile Bank of South Central Missouri, NationsBanc Mortgage, North American Savings Bank, Source One Mortgage and UMB Bank, all in Springfield.

In 1998, the MHDC has helped more than 2,500 families become homeowners in Missouri. Many will become homeowners for the first time using the Mortgage Revenue Bond mortgages. The MRB program is not funded by state taxpayers but through the sale of tax-exempt bonds to private investors. The tax-exempt bonds were authorized by Congress.

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