On Friday morning August 22nd., I made a presentation to the Oregon State Housing Council at their monthly meeting in Salem. I urged that the Council act on a timely basis to implement provisions in recently passed federal legislation that allow states to use tax exempt bonds for refinancing of adjustable rate loans made from 2002-2007. [My recommendation was also supported by Hacienda CDC (I am a board member)].
My short PDF presentation is HERE; in my oral remarks I added that FHA has done about 5,000 refi/$1 Billion loans in Oregon over the last 12 months, and suggested that OHCS bond program should be able to capture a significant share of that business, because of the below market interest rate the bond program can offer.
Using assumptions of how many ARM loans might refinance using OHCS bonds and a projected 2% savings on an average loan amount of $200,000, I estimated potential life-of-loan savings of $628 Million for 6,500 Oregon families.
The Council advised that they are currently researching how to implement this provision; my hope the Council can act quickly to have a plan in place for consideration at their [next] Sept 26th meeting.
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