ADFA drops mortgage interest rate
Here’s some good news for a lot of Arkansans wanting to buy homes and comparing what mortgage products are available — the Arkansas Development Finance Authority (ADFA) has dropped the interest rate on its HomeToOwn mortgage program from 5 percent to 4.5 percent and has some money available for people needing help with down payments.
HomeToOwn Murray Harding said he hopes today’s announcement from the ADFA will help more Arkansans secure financing to purchase houses. Granted, the 4.5 percent rate on a 30-year, fixed interest mortgage is a bit higher than Monday’s national average of 4.28 percent that was reported by the national Mortgage Bankers Association, but Harding said the advantages of the program make up for an elevated interest rate.
Before getting into that, it’s important to point out just what the program is. HomeToOwn, commonly referred to as the ADFA’s mortgage bond program, essentially puts the state agency in a mortgage underwriting position. The loans are administered through certified lenders throughout the article and are aimed at people who meet certain income requirements and purchase homes costing $225,000 or less.
Furthermore, it’s now common for lenders to require down payments from people wanting to take out mortgages. The ADFA has money available for those buyers in the form of a second mortgage with an interest rate of 1 percent (that was 5 percent, but the ADFA dropped that, too). And then there’s the credit score requirement — a lot of lenders are requiring a minimum score of 640, but the ADFA is below that at 620.
Often, the HomeToOwn program is available only to people who are first-time buyers — defined as people who have not owned a primary residence within the past three years. Of course, there are exceptions to the first-time buyer as the program is available to repeat buyers in some counties in Arkansas — Bradley, Calhoun, Chicot, Clark, Cleburne, Columbia, Conway, Crawford, Crittenden, Cross, Dallas, Desha, Drew, Jefferson, Lafayette, Lee, Lincoln, Madison, Mississippi, Monroe, Nevada, Ouachita, Perry, Phillips, Prairie, St. Francis, Scott, Searcy, White, Woodruff and Yell.
Interested in the HomeToLoan program? You might want to do a bit of research to see if you qualify, so get ready to click the following link. A good place to start is with the 2010 HomeToOwn Program Guide. You’ll also need to find out which Arkansas lenders participate in the program and a handy guide setting out the program’s income limits.
Any more questions? Visit the ADFA’s HomeToOwn Internet site.
Benton resident. Rogue journalist. Recovering attorney. Email = Ethan@FirstArkansasNews.net.