Title 4. Division of Development Finance — Subtitle 8. Maryland Home Financing Program

In this subtitle the following words have the meanings indicated.

“Fund” means the Homeownership Programs Fund under Subtitle 5 of this title.

“Household of limited income” means one or more individuals whose aggregate adjusted annual income does not exceed the upper income limits that the Secretary sets under § 4-807 of this subtitle.

“Lot consolidation” means the acquisition of real property adjacent to and in connection with a residence financed by the Program to include the real property as part of the residence.

“Median annual family income” means the median annual family income for the State, county, or area, whichever is greatest, as shown in the latest Census Bureau Report of the United States Department of Commerce.

“Preferred interest rate” means an interest rate that the Department sets under § 4-806(c) of this subtitle.

“Program” means the Maryland Home Financing Program.

“Region” means an area of the State that the Department establishes comprising one or more counties.

“Short-term loan” means a loan that, under the loan documents, is expected to be taken out by other financing within 7 years.

preferred interest rate loans to acquire, acquire and rehabilitate with or without demolition or lot consolidation, or refinance a primary residence by:

short–term construction loans to developers or nonprofit sponsors to construct or rehabilitate dwelling units that households of limited income can afford;

short–term loans to nonprofit sponsors, as defined in Departmental regulations, to acquire and construct or acquire and rehabilitate, with or without demolition or lot consolidation, dwelling units that households of limited income can afford to buy under a purchase or lease–purchase contract;

emergency assistance loans to households of limited income who, because of unemployment or other extraordinary hardship, cannot make current mortgage payments on their homes and risk forfeiting the title to their homes;

reverse equity loans to elderly households of limited income for housing–related expenses or personal expenses that enable the owner to continue to occupy the home; and

preferred interest rate loans to households that meet income standards set by the Department for the redemption of ground leases on their principal residence, including the transactional costs associated with the redemption.

contract for services related to the Program;

contract with private mortgage servicers to perform on behalf of the Department functions the servicers ordinarily perform, including foreclosure and employment of counsel;

require payment of a nonrefundable application fee;

purchase or commit to purchase from mortgage lenders notes or mortgages that meet the requirements of this subtitle, any regulations adopted under it, and appropriate Program directives; and

without approval or execution by the Board of Public Works:

The Department shall:

The Department shall adopt policies to ensure that each loan made under the Program is made only to:

In setting upper limits on adjusted annual income, the Department shall consider factors including:

Upper limits on adjusted annual income may vary for different:

Within the upper limits on adjusted annual income, lower income limit ranges and lower interest rates may be established for loans to households with adjusted annual incomes in the lower ranges.

Except for loans made under § 4–804(4) and (6) of this subtitle, the upper limits on adjusted annual income established under subsection (a) of this section may not exceed the median annual family income.

a completed application in a form that the Department requires;

a copy of the applicant’s latest State income tax return or other available verification of income, unless the application is for a loan under § 4-804(1)(i) or (2) of this subtitle; and

any other information or documentation that the Department considers necessary to make a determination on the loan.

To qualify for a loan under § 4-804(1)(i), (4), or (5) of this subtitle, an applicant:

To qualify for a loan under § 4-804(1)(ii) of this subtitle, an applicant:

To qualify for a loan under § 4-804(2) of this subtitle, an applicant shall agree to sell or rent each dwelling unit constructed or rehabilitated with the proceeds of the loan to a household of limited income.

To qualify for a loan under § 4–804(6) of this subtitle, an applicant shall:

To qualify for an emergency assistance loan made under § 4-804(4) of this subtitle, an applicant:

For an emergency assistance loan under § 4-804(4) of this subtitle:

be at least 62 years old when the loan closes; and

need financial assistance with housing-related expenses or personal expenses that enable the owner to continue to occupy the home.

To qualify for a short-term construction loan under § 4-804(2) of this subtitle, a developer or nonprofit sponsor shall:

To qualify for a short-term loan under § 4-804(3) of this subtitle, a nonprofit sponsor:

be unable to keep payments current on the applicant’s home mortgage because of exceptional adverse personal or economic circumstances; and

risk forfeiting title to the applicant’s home.

As to each loan, the Department may set:

A mortgage shall include the right of the Department to:

The Department may require a mortgage to be insured at the borrower’s expense by a federal, State, or private instrumentality.

After full disclosure to the borrower when the loan is made, the Department may take as security an adjustable interest rate mortgage under which any rate adjustment must:

On default, the Department may modify the interest rate, the time or amount of payment, or any other term of the loan to facilitate repayment of the loan and achieve the purposes of the Program.

For a mortgage securing a loan under this subtitle, the Department may allow:

For the developer of housing that will be priced so as to be affordable to households of limited income, the Department may commit to reserve for a fixed period a fixed amount of Program money to be available to finance preferred interest rate mortgage loans for households of limited income who seek to purchase from the developer fully constructed or rehabilitated homes.

A person may not knowingly make or cause to be made any material misstatement of fact, including an understatement or overstatement of financial condition, in a statement or report that:

A person who violates this section is guilty of a misdemeanor and on conviction is subject to imprisonment not exceeding 2 years or a fine not exceeding $5,000 or both.