Big Deal: New Home Loans in Texas
By AJ FanterLocal Lender Columnist
Apr 9, 2008
Who knew that hurricane clouds could have a silver lining? According to the Texas Department of Housing and Community Affairs (TDHCA), last year's Gulf Opportunity Act, created after Hurricane Rita, made many Texas homeowners eligible for a low-interest mortgage or a Mortgage Credit Certificate.
Through a network of participating lenders, the Texas First Time Homebuyer Program provides low-interest mortgages for those getting their first new home loan or who haven't owned a home in the past three years. The program offers two kinds of new home loans:
- An unassisted rate new home loan for those that don't need assistance with down payments or closing costs
- An assisted rate loan that provides grant funds for up to 4% of the mortgage amount
The funds available for these programs are broken down into two categories: targeted and untargeted. Typically, targeted funds are used in locations where there is economic distress. Because of the devastating effects of Hurricane Rita, the state of Texas expanded the number of counties that qualify as targeted, giving more people the opportunity to obtain a new home loan.
The "Rita GO Zone" legislation also allowed TDHCA to expand their Mortgage Credit Certificate Program, which lowers the federal income taxes of certain buyers purchasing a qualified residence. The lower tax rate will give Texas homeowners a bit more disposable income, making it easier to qualify for a new home loan and make the monthly mortgage payment. In addition, the TDHCA has also waived the first-time homebuyer status requirement, which gives more people the opportunity to take advantage of these unique Texas mortgage programs.
A total of $16 million has been set aside for those living in the 22 "Rita GO Zone" counties. If this applies to you, now might be the perfect time to take out a new home loan.
Sources:
Texas Department of Housing and Community Affairs
About the Author
AJ Fanter is a freelance writer based in Reno, NV.