Howard County Leaders Launch Opportunities for Wealth-Building Now, Enhance Other Programs

HOWARD COUNTY, MD — A new homeownership program has been launched in Howard County to help more residents own a home by offering low-interest financing for down payment assistance, improving home renovation loan criteria and investing in homeownership programs.

Called Opportunities for Wealth-Building Now, or OWN, the new program was announced by county leaders in addition to changes being made to the Settlement Downpayment Loan Program, which provides loans to income-eligible persons who need help in affording the down payment and settlement costs for buying a Howard County home, plus the Rehabilitation Loan Fund.

The proposed enhancements include:

• Capping the maximum SDLP interest rate at three percent to make the program more affordable to prospective homebuyers. The interest rates for SDLP loans are currently set at two percent below the buyer’s first mortgage rate. When interest rates are high, SDLP interest rates are also higher. Because SDLP loans are deferred until the homebuyer sells or refinances the home, the loan repayment amount will be significantly less at a three percent interest rate than it is now under the current regulations, the county stated.
• Creating a loan forgiveness provision for the HomeStarter loan, which will enable homeowners to have up to 30 percent of their loan balance forgiven at five, 10 and 15 years. This policy change will help low- and moderate-income homeowners keep more equity in their homes, county leaders said.
• Removing the requirement of insufficient assets to qualify for the Workforce Initiative Loan, a type of SDLP loan, which will expand eligibility to potential homebuyers that work in the county.

"In Howard County, our residents enjoy one of the very best places to live, work, play, grow and thrive for all. People move to Howard County for our incredible schools, vast parks, abundant community amenities and vibrant small businesses. However, with mortgage interest rates at a 20-year high, many future homebuyers are hesitant to enter the market, while existing homeowners are discouraged from selling. To continue making Howard County a place where all families can call home, we must promote affordable homeownership opportunities that empower residents to put down roots in our community," said Howard County Executive Calvin Ball.

DHCD’s RLF program provides loans to income-eligible residents to help pay for home improvements, renovations or repairs, such as new heating and air conditioning systems, roof replacement and bathroom upgrades, to improve energy efficiency and accessibility. The proposed regulation modifications include:

• Amending the RLF program regulations to add language that details the processes and procedures associated with the application and underwriting of County rehabilitation loans.
• Setting loan interest rates at zero, one or two percent based on household income limits. Additionally, proposing that for:
  • Zero percent loans (low income), loans are deferred and forgiven at 20 percent per year for five years; and for
  • One percent loans, loans are deferred for five years before repayment begins.
• Increasing the new maximum loan amount to $50,000 per loan.

“Capping the down payment loan at three percent is a huge help in an environment where the mortgage interest rate is not expected to fall below six percent in the foreseeable future,” said Piet de Dreu, president of the Howard County Association of Realtors. “HCAR is confident that the proposed changes to the Settlement Downpayment Loan Program will open the door to homeownership for more people in Howard County and the changes to the Rehabilitation Loan Fund will increase home values and allow more seniors to age in place.”

Ball has included more than $4.5 million in his proposed fiscal year 2025 budget. Of that amount, $4 million will be directed towards homeownership programs like SDLP, helping to create opportunities for more than 100 households to gain access to homeownership. An additional $600,000 will go towards DHCD’s RLF program to continue its support for low- and moderate-income homeowners to maintain their homes, make repairs that can improve energy efficiency and improve accessibility to age in place. The remaining $110,000 will go towards DHCD’s homebuyer education workshops.