Buying a house in Arkansas? The state might help.
While there are more than a few programs set up to help people purchase homes, one that has remained somewhat overlooked is the HomeToOwn mortgage program run by the Arkansas Development Finance Authority (ADFA).
Yes, we’re talking about the state’s “bond program” that offers 30-year mortgages at an interest rate of 4.625 percent to qualified buyers. That edges out the current going rate of 4.92 percent, meaning that Murray Harding — the HomeToOwn program administrator — was correct when he described his group’s interest rate as “competitive” at a meeting of the Benton-Bryant Realtors Association a couple of weeks ago. The money for the program comes from the state’s sale of tax-exempt bonds.
Ah, but there’s more. The ADFA can also help with down payments through second mortgages that feature an interest rate of 1 percent.
There are, of course, some requirements that people wanting to buy houses through the ADFA program must meet. For one thing, the maximum purchase price under the program is $225,000 — well above Arkansas average sales prices.
Those averages vary in Arkansas, of course — the average in Saline County through January and February, for example, was $156,764. In central Arkansas as a whole the average sales price in 2011 was $161,865. Regardless of where you live in Arkansas, the average sales price is far below $225,000.
“There are a lot of people who could qualify for this program,” Harding said.
There are also income limits to consider and those vary by county. You can get a list of those by clicking here. Also, there are only certain lenders in the state that administer the program and you can find a list of those by clicking here.
Finally, anyone purchasing a home through the program must be a first-time buyer. Well, sort of. The ADFA uses the federal definition of a first-time home buyer, which means someone who has not owned a primary residence in the past three years. Oh, and one more thing — you don’t have to be a first-time home buyer if you’re purchasing a home in 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 or Yell counties.
Confusing? A bit, perhaps, but the fine folks at ADFA are willing to help buyers step through the application process and you can visit them on the Internet here. You’ll also find the handy HomeToOwn program summary sheet here.
The program exists as another option for people to consider when they’re planning to purchase a home. It’s helped out thousands of Arkansans over the years and may be well worth considering.
Benton resident. Rogue journalist. Recovering attorney. Email = Ethan@FirstArkansasNews.net.