03/17/2009 (2) - Laserfiche WebLink

Home Browse Search

might not like it. He said the purpose and reason to keep liquidity in the market is a good one and he would hate to penalize those who have a hard time getting into homes. Vice Chairman Flescher asked staff what was our current failure rate for the SHIP program participation as far as our applicants; how many participant banking financial institutions do we have currently; and whether there was any concern that we would have a very limited amount of financial institutions that would be able to participate, coupled with the fact that we are looking at reduced funding for the SHIP Program. Director Keating said our foreclosure rate is about 2% and we are doing pretty well, working with members in the consortium who help us with home buyer education, and providing principal mortgages for homes. Althea McKenzie argued that if the mortgage loans are so good, why then are the banks selling them. She said they should be retaining it as part of their CRA because that is part of their commitment and requirement as a bank to keep the CRA. She agreed, from earlier discussions, that it would be fair and equitable for the origination points to come out of the SHIP funds, but she questioned what does the 1% leave room to do. She argued further that these programs are designed to create lending applications and to have people take advantage of them, but for a bank to say it wants an additional 1% and to be able to sell the loan, was kind of a contradiction on their CRA commitment. She believed the originating fee is sufficient but the 1% may be excessive for those who cannot afford it. Ms. Reichert said the extra point would allow her to lower the applicant's rate. Ms. Saunders outlined the banks requirements/criteria under the Community Reinvestment Act; and said they are focused on low and moderate income, and if things get better they might be willing to go back to the old way. March 17, 2009 21