A record number of first-time homebuyers turning to the state last year for help with their first mortgages has Maryland officials keeping a wary eye on the program?s finances, and looking for new sources of income.
The state helped more than 4,000 families last year through its Maryland Mortgage Program with more than $780 million in loans, according to Andy DeVilbiss, public information officer for the state Department of Housing and Community Development.
But the increased interest has forced the state to look for new sources of funding, according to Bill Ariano, deputy director of the Department of Housing and Community Development?s Community Development Administration.
“We can continue to handle the volume we have now,” Ariano said. “We feel comfortable for at least the next 12 to 18 months. What we?re hoping is during that period we can identify other funding mechanisms.”
Ariano said the state will continue to sell both the taxable and nontaxable bonds to fund the program, and has sought changes in legislation that would provide the department flexibility in seeking funding.
Homebuyers have turned to the state?s program amid crisis in the market for subprime and other riskier mortgages, not just in Maryland but nationwide, Ariano said, leaving a number of states scrambling to fund their programs.
“We?re talking with other states. This is not just a problem in Maryland, this is a problem throughout the nation,” Ariano said.
But keeping the program at its current levels, or even expanding, might not be the best idea, said Stephen Walters, professor of economics at Loyola College. Although some might be eager to sell the dream of homeownership, Walters said, not everyone can handle the financial commitment.
“If you?re looking for ways to cut the spending side of the state budget, now might be the moment to say, maybe we went too far,” he said.
