HOMEOWNERSHIP PROGRAMS
F. William Beans, Director 974-3524

The Maryland Mortgage Program (MMP) origi-
nated in 1980 as the Mortgage Purchase Program
and received its present name in July 1987. The
Program was implemented when mortgage funds
available through private lending institutions dwin-
dled and mortgage rates rose. The MMP provides
reduced-interest mortgage loans to eligible home
buyers through participating lending institutions.
In this program, the Administration purchases
loans made by lending institutions to eligible low-
and moderate-income persons.

Both newly constructed and existing homes are
eligible under the Maryland Mortgage Program.
MMP is designed primarily for first-time home buy-
ers. Applications for loans are made to a participat-
ing mortgage lender.

Federal law designates certain low-income areas
as target areas for which 20 percent of the funds
from bond issues must be set aside. In these areas,
purchase price limits are slightly higher and buyers
are not required to be first-time home buyers.

The Maryland Mortgage Program is funded by
the sale of tax-exempt revenue bonds. Both the
acquisition cost and income limits are set by the
Administration using federal tax law guidelines.
Acquisition costs vary by region.

In 1987, the Homeownership Development 'Pro-
gram (HDP) was merged with MMP First funded
in 1979, HDP is funded through the sale of tax-ex-
empt revenue bonds. Funds are designated for
newly constructed homes in approved subdivisions.

Using the guidelines of the Mortgage Subsidy
Bond Tax Act of 1980, the Administration sets
maximum income limits for participants in the
Homeownership Development Program. Sales
price limits are also set by the Administration. They
are based both on affbrdability within the income
limits and the interest rate for the revenue bonds.
Loans are given on a first-come, first-serve basis.

The Maryland Home Financing Program
(MHFP) was authorized by the General Assembly
in 1972 and first funded with the sale of State
general obligation bonds in 1973. This direct-loan
program expands homeownership opportunities
for low-income Marylanders. By virtue of its fund-
ing source—general obligation bonds and appro-
priations, and a revolving fund from prior loans
under the Program—it differs from the other sin-
gle-family programs. Outreach agents make the
Program accessible in each region of the State.
Loans have been made in every county and Balti-
more City (Code 1957, Art. 83B, secs. 2-401
through 2-409; Code Financial Institutions Article,
sec. 13-310).

Department of Housing & Community Development/293

In 1988, the Homeownership Incentive Program
(HIP) was combined into MHFP Created by the
General Assembly in 1986, HIP stimulates the
production and rehabilitation of owner-occupied
housing by providing below market loans targeted
at households with income less than $20,000 per
year. The Administration encourages local govern-
ments and nonprofit organizations to contribute
local resources for developments funded through
this program.

The Homeownership Emergency Mortgage Assis-
tance Program (HEMAP) was created by the Gen-
eral Assembly in 1984. The Program provides
mortgage assistance to help involuntarily unem-
ployed home owners. Working through housing
counseling agencies, short-term loans are provided
to eligible homeowners. Funds for the Program are
provided from general obligation bonds. The Settle-
ment Expense Loan Program (SELP) was created by
the General Assembly in 1988. The Program pro-
vides low interest loans for settlement expenses to
eligible low- and moderate-income home buyers
who do not have sufficient resources to purchase an
affordable home. The Program will fund its first
loans in late 1988.

, The Reverse Equity Mortgage Program (REMP)
was established by the General Assembly in 1986
and first funded in 1988 through CDA reserve
funds. The Program enables older Maryland home-
owners to gain access to the accumulated equity in
their homes without having to sell or move. No
repayment of the loan is required until the eligible
borrower dies, sells the house, or permanendy
moves out of the home.

RENTAL HOUSING PROGRAMS
. Nancy Rase, Director 974-2122

' The Rental Housing Production Program (RHPP)
' was created by the legislature in 1986 to stimulate
production of rental housing for lower-income
: households. Funds can be used for capital assistance
to cover costs of construction, rehabilitation, or
acquisition of rental housing, or for mortgage assis-
i tance to reduce the operating costs of rental hous-
r ing. Local governments must make a contribution
. to reduce costs or otherwise support developments
i financed through the Program. Priority is given to
j developments that serve households at 30 percent
or less of area median income.

The Market-Rate Rental Housing Program pro-
' vides below-market rate construction and perma-
nent financing using taxable and tax-exempt bonds
: and notes. To be eligible, developments must set
aside a portion of the units for limited-income
households.

, The Maryland Housing Rehabilitation Program—
Multi-Family (MHRP—MF) is designed to preserve