A revolving workforce home loan program and making an appropriation. (FE)

1. The applicant is an individual applying for the loan as a head of household, as determined by WHEDA.

2. The applicant has not had any ownership interest in residential real property for the three consecutive years immediately preceding the date of the application.

3. The applicant's household annual income is less than 120 percent of the area median income for the county in which the home is located.

4. The applicant's housing costs, excluding utility-related costs, in the home for which the applicant is applying for a workforce home loan, as determined by the qualified organization, will not exceed 30 percent of the applicant's household income.

5. The total amount of the mortgage for which the applicant is applying for a workforce home loan does not exceed the conforming loan limit for the county in which the home is located, as established by the federal housing finance agency.

6. The applicant has a satisfactory credit record, history, or rating, as determined by the qualified organization in consultation with WHEDA.

The bill provides that WHEDA may not issue a workforce home loan that exceeds $100,000, adjusted for inflation annually beginning on the effective date of the bill. The bill requires that the amount of each workforce home loan be based on the applicant's household income and size in combination with the amount of funding available for the loan.

The bill establish different repayment rules for workforce home loans depending on the eligible applicant's household income. Specifically, if the authority issues a workforce home loan to an applicant whose household income is less than 80 percent of the area median income for the county in which the home is located, all of the following apply:

1. The repayment of principal due on the loan must be deferred until the recipient of the workforce home loan sells the home or loses equity in the home as a result of refinancing or the home ceases to be the primary residence of the recipient.

2. Beginning with the sixth full year following the issuance date of the workforce home loan, each year WHEDA must forgive 10 percent of the total amount of unpaid principal on the loan.

On the other hand, if WHEDA issues a workforce home loan to an applicant whose household income is 80 percent or more of the area median income for the county in which the home is located, the repayment of principal on the loan must be deferred for the five consecutive years beginning after the date on which the loan is issued, immediately after which the loan recipient is required to begin the repayment of principal on the loan in monthly installments, or until the recipient of the workforce home loan sells the home or loses equity in the home as a result of refinancing or the home ceases to be the primary residence of the recipient.

Because this bill may increase or decrease, directly or indirectly, the cost of the development, construction, financing, purchasing, sale, ownership, or availability of housing in this state, the Department of Administration, as required by law, will prepare a report to be printed as an appendix to this bill.