COLUMBUS — As one response to Ohio's escalating mortgage foreclosure crisis, the Ohio Housing Finance Agency for the first time will provide homeowners with help in refinancing their mortgages.

The agency will issue $100 million in taxable municipal bonds to provide approximately 1,000 families with average loans of $100,000 per home.

Extras

Photos

Click to enlarge

If demand is sufficient, the agency will issue additional bonds or launch other forms of financing up to $500 million each year, a press release said. The program is to start next Monday.

"We are aware of the detrimental effect of unaffordable monthly mortgage payments on the people of the state of Ohio," said Doug Garver, agency executive director.

The decision comes in the wake of a report issued Monday by the Cleveland-based Policy Matters Ohio that showed foreclosure filings in Ohio jumped sharply last year, increasing by more than 15,000 or 23.6 percent over 2005. There were 79,072 new foreclosure filings last year, the report said.

While the new program won't provide assistance to all who need it, "we can help hundreds if not thousands of existing home buyers," said Garver.

He said that he believes Ohio is the first or among the first states to provide refinancing help through its housing agency. The agency traditionally has helped with financing for first-time buyers through tax-exempt bonds, he said.

The new program represents the other side of the agency's mission — "to help people stay in their homes," Garver said.

The refinance program will offer 30-year fixed-rate loans at an interest rate that is expected to be about 6.75 percent.

The program will be available statewide, and loans will be provided through the agency's network of lending partners.

Participants must have household incomes that do not exceed 125 percent of the median income of their county. A list of participating lenders will be available next Monday at www.OhioHome.org.

Applicants must live in their home to qualify. Eligible properties include single-family homes, condominiums or townhouses.

The program will require four hours of face-to-face counseling to qualify.

Generally this requires two hours for an initial interview and an additional two hours of one-on-one counseling.

To assist with closing costs in the refinancing, the program also will offer a 20-year fixed-rate second mortgage option at an amount up to 4 percent of the appraised value of the home. The second mortgage option will be financed by $4 million in funding approved by the agency's board.

——————————

County limits

County income limits for refinancing program:

Butler $80,750

Clark $74,750

Darke $73,000

Greene $74,750

Miami $74,750

Montgomery $74,750

Preble $73,000

Warren $80,750

Source: Ohio Housing Finance Agency