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Ohio Bond Program Information

Courtesy of Gillian Meadows of Humphries Mortgage:

  1. Currently the bond program is back into swing.  It is not necessarily the most competitive interest rate in most cases right now but it definitely has its advantages.
    • The current rate is 5.625%.  If your client is a health care worker, teacher, or in the military they qualify for a rate of 5.375%.
    • This program requires a minimum down payment of 3.5% however there is a grant available to help pay for that down payment in the amount of 2.5% so only one percent is needed (a higher rate is applied to the loan if the client takes advantage of this grant).
    • If your client uses bond financing to purchase their home this will not affect their qualifications for the tax credit (last years tax credit was affected by using bond financing).
  2. When negotiating a contract for your buyer and the seller wants your buyer to use their title company, and as an incentive they are offering to provide the buyer with free owners title insurance, this may not really save your client money.  Talk to the title company or mortgage lender that you work with and ask them how much the title company's closing costs are including owners and lenders title insurance and compare it to what the seller’s title company will charge.  You may find out that they charge more in fees than what the owner’s title insurance policy will cost and your client may not be saving money.
  3. In this market while interest rates are so low your client may want to look at the option of paying points to buy down the interest rate.  They will most likely never refinance with such a low rate and right now the spread of price between rates is not very much, so depending on the day and the lender it may not cost very much at all to get a much better rate.  It may not take much time at all to recoup that cost and then they will save for the rest of the time they own that loan.
I hope this is helpful.  If you have any questions please feel free to give me a call.