Low-income housing loan program expands Mortgage covers purchase, fix-up costs


A year-old program to provide mortgage and rehabilitation money to low- and moderate-income families has been expanded with the addition of Signet Bank and three housing groups.

"We were looking for an opportunity to get involved and we saw a real opportunity here," said Edward M. Hill 2nd, vice president of Signet Mortgage Corp., an affiliate of Signet Bank.

The program, known as Housing Acquisition Rehabilitation Program (HARP), was started a year ago with the Bank of Baltimore as the lending institution. During the year, 34 loan applications were approved, according to Jerome P. Baroch, senior executive vice president of Baltimore Bancorp., the parent company of the Bank of Baltimore. The loans totaled about $1 million, with about $301,000 of that for renovation, he said.

Now that Signet has joined, the goal is to more than double participation, Baroch said.

HARP offers loans ranging from $10,000 to $60,000 to low- and moderate-income individuals to buy and renovate existing houses in Maryland with special emphasis on renters buying their homes.

The maximum income levels are $28,000 for one wage earner and $33,000 for a household with two or more wage-earners.

The mortgages can cover up to 100 percent of the purchase price and the cost of rehabilitation. The fixed rate mortgages can be up to 30 years and the interest is based on market rates.

Because no down payment is required, borrowers can buy a home with a very low cash outlay. Settlement costs are kept down to between $500 to $1,000 with help from the Maryland Settlement Expense Loan Program, Baroch said.

The loans are partially insured by the state.

The primary agency for taking applications has been St. Ambrose Housing Aid Center, a non-profit housing group. The South East Community Organization/Southeast Development Inc. has provided housing counseling and has referred people to St. Ambrose. Three community groups that are now joining in this effort are the Belair-Edison Housing Services, the Coalition of Peninsula Organizations and Northwest Baltimore Corp.

The Maryland Alliance for Responsible Investment, an advocacy group, has promoted the program and acts as a coordinator between the non-profit groups and the banks. The Bank of Baltimore has total assets of $3.5 billion and 51 branches in the Baltimore area. Signet, a regional bank holding company based in Richmond, has total assets of $11.4 billion, with 236 branches in Maryland, Virginia and the District of Columbia.

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