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Large numbers of first-time home buyers have been turning to North Dakota Housing Finance Agency for financing help, setting spring records.

“NDHFA’s FirstHome loan reservations total in May was 185 percent higher than last year,” said NDHFA's executive director Jolene Kline, with 262 loans in May for $44 million in financing.

During the same time period in 2017, NDHFA recorded 141 loan reservations.

The state agency’s program provides first-time home buyers with low-cost financing by working with private-sector lenders that originate the loans. NDHFA then buys the loans and, if desired, help with the down payment and closing cost, an option used by 60 percent of borrowers.

The financing aid comes in the form of lower interest rates.

“With conventional financing at 4.25 percent and NDHFA at 3.75 percent, the payment on a $200,000 loan is about $60 less per month,” Dave Flohr, NDHFA homeownership division director, said in a statement.

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So far in 2018, the average loan has been just under $167,000. The limit for single-family homes purchased is $271,164 to $303,882, depending on household size and the county in which the property is located.

In Burleigh County, it’s $284,823.

NDHFA’s program is available to couples or residents earning up to $98,900 who have not owned a home in the past three years. In 2017, the average borrower’s household income was $56,000.

Comparing May 2017 through May 2018, Burleigh County has gone from making up 21 percent of loans made by the agency to 18.5 percent. Morton County has gone from 9.5 percent to 8.52 percent of loans made. Cass County, which makes up the largest source of loans, has stayed mostly even around 32 percent.

Grand Forks County, while only making up 6.9 percent of loans in 2018, is at almost double last year’s numbers. In Williams County, where the oil boom has led to a limited number of entry-level homes, loans are down 25 percent, from 3.72 percent to 2.96 percent of the agency’s loans.

“Homeownership rates in North Dakota declined during the energy boom with many incoming households choosing to rent,” Kline said. “If our purchase activity is indicative of more households becoming homeowners, that is a good thing for North Dakota because homeowners are more invested in their community.”

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Reach Jessica Holdman at 701-250-8261 or jessica.holdman@bismarcktribune.com

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