Rendell says $1.2 billion available to help homebuyers

Homebuyers in the Commonwealth will benefit from more than $1.2 billion being made available through the PA Housing Finance Agency (PHFA), according to Gov. Ed Rendell. He announced at a press conference Tuesday that Pennsylvania is “fighting back” against the effects of Wall Street greed by helping homebuyers with low-interest, fixed-rate mortgages offered through PHFA.

Gov. Ed Rendell

“Through this funding we’ll help jump-start the economy in Pennsylvania,” Rendell said. “These long-term, low-interest, fixed-rate mortgages are exactly what our consumers need,” he added.

A total of $50 million will be set aside for new home construction, according to Rendell. The new home construction loans will offer homebuyers a 30-year, fixed-rate mortgage at 4.5 percent. This initiative is expected to help encourage new building activity, create jobs and boost the economy.

Rendell touted the success of the PA Housing Finance Agency’s popular Tax Credit Advance (TCA) loans offered earlier this year. In four months, PHFA gave $5.75 million in advance loans on first-time mortgages to about 1,300 Pennsylvania consumers.

PHFA has earmarked a total of $10 million for the TCA program which provides an interest-free loan to use toward down payment and/or closing costs. The tax credit is offered through some PHFA some lenders. If the TCA is repaid by June 30, 2010, (or on June 30, 2011 for loans that close in 2010), the borrower pays no interest for the loan. As with the revised federal tax credit program, existing homeowners may also be eligible for the tax credit advance if they meet the criteria.

It’s estimated that the PHFA programs will provide 11,000 long-term (30-year), fixed-rate, low-interest first mortgages.

The initiative is a partnership between the Pennsylvania Housing Finance Agency, the U.S. Treasury, FannieMae and FreddieMac.

Related posts:

1. HEMAP foreclosure assistance ends due to budget cuts
2. Foreclosure prevention funding application deadline is Sept. 16

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Tags: mortgages, phfa, tax credit

This entry was posted on Wednesday, December 23rd, 2009 at 3:08 pm and is filed under Association News, Economics, Industry News. You can follow any responses to this entry through the RSS 2.0 feed.