Newspaper article THE JOURNAL RECORD
Housing Finance Agency Panel Approves $200 Million in Bonds
Final details of the new program are expected to be completed in December, but the trustees did approve Stifel Nicolaus & Co. as senior underwriter, plus Merrill Lynch Capital Market; Kidder Peabody & Co. of Tulsa; and Leo Oppenheim & Co. as co-managers for the loan program.
To be selected later will be the trustee bank, the bond insurer and the primary mortgage insurance company, trustees said. The bond issue, for single family construction only, will be a General Equity Mortgage Plan, last used by the agency in 1983.
This program is expected to have an interest rate of about 9.5 percent, depending on the market when the package is made final, and it will be a fixed rate, the trustees said.
There are two significant differences from the 1984 program, the trustees were told.
- One will be that the loans will be assumable, which has not been the case since 1980.
- The other difference is that monthly payments will rise 3 percent each month, beginning with the 25th month of the life of the 30-year mortgages. This, the trustees were told, will be about 1percent of the monthly income of the borrowers.
This monthly increase, trustees were told, will be applied to the principle of the loan, which will pay off the mortgage sooner.
Authority members will decide later what percentage of the loans will be insured. About half of loans made under the 1984 bond program were insured. …