2007 Housing Agency’s Biggest Year for First-time Buyers

BISMARCK – A record number of first-time buyers purchased a home in 2007 using the North Dakota Housing Finance Agency’s (NDHFA) FirstHome™ program.

“2007 was North Dakota Housing’s biggest year for first-time buyers,” said Mike Anderson, NDHFA executive director. “We also saw our greatest jump in program use with a 28 percent increase over the previous year.”

The FirstHome program offers reduced interest rate mortgages to low- to moderate-income first-time buyers. NDHFA set agency records by purchasing the mortgages of 1,733 first-time homebuyers in 2007; the total loan volume was $175 million. Since the program began in 1982, NDHFA has made homeownership a reality for 31,000 North Dakota households.

“With interest rates that are lower than the conventional market place and our down payment assistance, North Dakota Housing offers the extra boost many young families need to be able to get into a starter home,” said Dave Flohr, NDHFA homeownership division director.

The average mortgage loan purchased by the NDHFA in 2007 was $101,000. Over the past year, the Agency’s interest rates ranged from 5.20 to 5.85 percent compared to conventional market rates of 5.50 to 6.45 percent. On a $101,000 mortgage loan, NDHFA’s lower rate can save a borrower more than $10,000 over the life of a 30-year fixed rate loan.

Sixty-two percent of NDHFA’s borrowers received some form of down payment assistance in 2007. The most common assistance option utilized was the Agency’s Start program which provided 869 borrowers with an affordable first mortgage and additional help with out-of-pocket cash requirements.

“Thirty-seven lenders actively participated in our homeownership program this year,” said Anderson. “The top loan originators were Gate City Bank, Wells Fargo Home Mortgage, Dakota Community Bank, State Bank and Trust, and Town and Country Credit Union.”

Because NDHFA is a state agency, it must partner with private sector lenders to originate loans. The participating lenders sell the loans to the Agency.

Counties with the greatest program usage were Cass (601), Burleigh (257), Grand Forks (131), Ward (164), Morton (98) and Stark (97). While the highest program use was in Cass County, the highest reported average loan amount was in Burleigh County at $122,125. Billings and Slope were the only counties in 2007 with no program activity.

“The low-interest loans offered by North Dakota Housing strengthen our state’s economy and provided homebuyers with financial stability,” said Anderson. “For many families, owning a home is their primary means of wealth accumulation.”

NDHFA’s homeownership division is dedicated to helping low- to moderate-income North Dakotans achieve successful homeownership through homebuyer education, down payment and closing cost assistance, and affordable mortgage loans.

To determine eligibility or for more information on the programs, potential homebuyers should contact an NDHFA participating lender. Information is also available online at www.ndhfa.org.

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