Travis County Commssioners Court
June 22, 2004
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Housing Finance Corporation
Next up, let us call to order the Travis County housing finance corporation. Voting session. Tuesday, June 22, 2004. Let's show president Biscoe gone for the entirety of this meeting. 1. Approve minute of board of directors meetings of March 9 and March 16, 2004.
>> move approval.
>> second.
>> moved and seconded bid that we approve the minutes. Any further discussion? All in favor? That passes unanimously. 2. Consider and take appropriate action on whether to extend enhancement to the 2002 single-family bond program. Harvey Davis.
>> good afternoon, I’m harvey Davis, manager for the corporation. Last March, the board authorized -- funding of an additional one percent down payment assistance on a lot, two million, a lot of our single family bond program. I’m happy to report that -- that that lot fully originated and the time period has -- has expired and so the -- so the reason for this agenda item is to -- is to go over with the board whether to -- whether the board wishes to extend the 1% down payment assistance to the next lot or whether the board wants to set aside a certain amount of money on the next lot. There is some questions that I have discussed in my memo about how much funds -- how much excess funds the corporation does have to -- to continue this financing, but if it's okay with -- with you -- with you director Sonleitner, if we get an -- if mark gives the update on how the board is doing.
>> mark o'brien, with morgan keegan and company, the bond underwriter for the 2002 bond program. When we visited with you in March, we had said that this program which closed in December of 2002 had slow going. This is true throughout the country and throughout the state and throughout the country on tax exempt single family bond programs for a number of reasons, rates being low, refinance busy being heavy, other program products. Also we didn't have the city of Austin when we started this program. In fact in January 1 the city of Austin did include their lending area. When we saw you in March we had said some other issuers around the state who had the resources to do so were adding one or two percent of down payment assistance. We automatically include 4% of down payment assistance for each mortgage loan made under this program. For example, $100,000 loan comes with a $4,000 grant from -- for down payment closing costs, this is funded from the bond purchaser. 4% premium on the bonds. What we propose to you in March was that you add an additional one percent out of your own funds to make it a 5% grant program for each loan. We had relatively low origination on each of our first four lots, lot 5 was the one, you authorized that one. That one she said effectively March 1st, a 599 mortgage rate, a $2 million lot. First one fully originated, we actually had 2.2 million closed during that lot. We just set last week the lot for the 6th -- the 6 lot, two million, it has got the automatic 4% grant. What judge Biscoe asked when we did this was come back and tell us how this goes, if it was successful, we will think about whether or not we want to do it for a subsequent lot. I will say that the state bond program right now is at a 5.50 mortgage rate. 95 base points less. Only 4%, also a soft second lien, the borrower has to pay that back on refinance, it's an outright grant and would obviously be a more competitive advantage with 5% than 4% in your prior lot. We did mention in the March 9th meeting that we would do some other marketing which we have done. We have distributed brochures, been in touch with the Pflugerville chamber of commerce. I have met individually with some of your lenders in their offices to get them focused on the product. Ctx in particular has been a very good lender really moved a lot of this project. Also on the mortgage show, a call-in radio program to let the Travis County community know about the program. So I think all of these things have contributed to the success of the current lot. And so it would be our recommendation that we continue for the next lot that enhancement to the program with an additional 1% of down payment assistance. I would be happy to answer any questions.
>> is that the recommendation of mr. Davis as well is to continue on with the next lot?
>> yes. That would be my recommendation.
>> I move approval of the recommendation.
>> moved and seconded about moving forward on the next lot. Any other questions by any of of the directors? All in favor? That passes unanimously.
>> move adjourn.
>> thank you.
>> moved and seconded that we adjourn. All those in favor? That passes unanimously.
Last Modified: Wednesday, June 23, 2004 8:44 AM