Feds OK home loan for Saipan

The United States government is extending the implementation of another public housing program in the Northern Marianas to increase home ownership among moderate-income families on the island.

The Northern Marianas Housing Corporation said making the Guaranteed Rural Housing (GRH) Loan Program available to CNMI residents would facilitate the growth of home owners in the Commonwealth.

The program will be implemented here through the Rural Development of the U.S. Department of Agriculture under the Cranston-Gonzales National Affordable Housing Act, which was enacted on Nov. 29, 1990.

Rep. William S. Torres disclosed he has received an official letter from Rural Development Acting Director for the State of Hawaii-Western Pacific Region Steven Chapman, containing information that the Bank of Hawaii has been approved to initially process $1 million worth of guaranteed loans for Saipan.

NMHC Board Chair John S. Tenorio said the GRH Loan Program will basically cater to moderate-income families although they have stronger repayment ability than those in the lower income bracket, which makes them more capable of obtaining direct loans.

According to the government-controlled corporation official, programs for the moderate-income families are limited in the Commonwealth since majority of the existing public housing programs in the CNMI are geared at assisting low-income families.

“This development has brought much excitement at the NMHC as it is a start for another residential lending program for moderate-income families,” said Mr. Tenorio in a media statement.

Under the GRH Loan Program, residents whose adjusted annual income falls within the limit set for the Commonwealth may seek credit packages for the purchase or construction of a modest house in a rural area.

Mr. Tenorio also stressed that loan applications will be approved according to the applicants’ repayment ability and credit history. Applicants must also demonstrate the ability to properly maintain the home to be funded under the program.

The program works to the benefit of both the borrower and the lender since the Rural Development would guarantee as much as 100 percent of the loan, using the current market value or acquisition cost of the unit as basis in the computation.

This effectively eliminates the need for a downpayment from the applicant because the full faith and credit of the U.S. government backs the loan guarantees, said Mr. Tenorio, adding that interest rate is fixed.

Loans approved by creditors under this program would increase their community involvement and may be considered as part of their activity as required under the Community Reinvestment Act.