More first-time homebuyers than ever sought out state help in acquiring their mortgage last year ? a big boom coming amid uncertainly in more risky mortgage plans.
Fiscal 2007 saw a record number of would-be homeowners turn to the Maryland Mortgage Program for their first-ever mortgage. The program doled out $750 million in loans to more than 4,000 Maryland families according to Andy DeVilbiss, public information officer for the state Department of Housing and Community Development.
“We do pretty good business,” he said. “Last fiscal year shattered every benchmark we had.”
DeVilbiss credited increased marketing of the fund?s 12 financing options and greater variety of products with the increase, but said the national subprime mortgage crisis played a part as well. Homeowners who might have once considered riskier options are now more interested in the state?s stable programs, he said.
“We definitely market our program as an alternative to subprime and these exotic mortgage programs,” DeVilbiss said. “We?re tryingto get ahead of the curve and stop things before it becomes a crisis.”
The program is funded through tax-exempt bonds sold to finance the mortgage products.
According to the Maryland Association of Realtors? Housing Affordability Index, in July, first-time homebuyers had 49.1 percent of the income needed to buy a starter home. That number was down from the first-quarter level of 50.4 percent, but up from the second quarter of 2006, when it stood at 43 percent.
Increased interest in the state?s program isn?t surprising, according to Lance Cassell, managing director of the Hunt Valley-based Better Mortgage Bureau, who said homebuyers are looking for stability and are still likely to find it on the market.
“I think what the buyer will find is that there?s plenty of options out there and the rates are still historically low,” he said. “What they?re not going to see is so many of those exotic products that offer low interest rates for the first years.”
ON THE NET
Maryland Mortgage Program
www.morehouse4less.com
