First-time homebuyers with low to moderate incomes can qualify for no-interest loans they won't have to pay back until they sell their houses, under a program to be announced today by County Executive John G. Gary.
And those who buy housing in Annapolis may never have to repay the loans if they stay in their homes for 15 or 20 years, depending on whether they buy an existing house or a new one.
The loans of up to $20,000 each in the form of second mortgages will help buyers cover the down payment, closing costs and BTC other settlement costs for homes in communities in and around Annapolis, according to the county executive's office.
The loan program combines state and county money from the federally funded HOME Investment Partnership Program. Of the $430,000, $300,000 is available for homes in Annapolis. The rest is available for housing in Arnold, Edgewater and Crownsville.
Arundel Community Development Services Inc., which will administer the program, applied specifically for money for the Annapolis area, said Kathleen M. Koch, executive director of the agency.
While many first-time buyers can afford monthly mortgage payments, they have a harder time putting together the several thousand dollars necessary to pay closing costs, she explained.
The HOMEownership Loan Program can work with programs that offer low-interest mortgages and other financing to help first-time homebuyers, she said.
Eligibility and loan amount are based on income.
A family of four may have an annual household income of no more than $29,650 to borrow the maximum $20,000.
The maximum price for housing purchased with one of the loans is $110,000.
Participants must receive financial and homeownership counseling to qualify for the loans, Ms. Koch said.
More than 100 people have completed group and individual counseling sessions on budgeting and the home-buying process offered free by Arundel Community Development Services.
The agency will follow up with participants after they buy their houses to recommend a maintenance schedule and to review their budgets and measures that help prevent foreclosure, Ms. Koch said.
Mr. Gary plans to recognize the first graduates of the counseling program during a news conference at 10 a.m. at the Arundel Center in Annapolis.
People interested in the HOMEownership Loan Program or in counseling services should call Arundel Community Development Services at (410) 222-7600.