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BALTIMORE – Municipal Employees Credit Union of Baltimore has become the first credit union in the Baltimore metropolitan area to participate in the Federal Home Loan Bank of Atlanta’s First Time Homebuyer Program. The First Time Homebuyer Program helps low income consumers purchase their first home by providing them funds to help with downpayments and settlement costs. The FHLB program matches every dollar the buyer contributes toward their downpayment and closing costs with three dollars, up to $3,000. The buyer must put in a minimum of $500, and their money cannot be from another grant, settlement assistance, or “live where you work” program. The money can be a gift from a family member. MECU also developed its own First Time Homebuyer Mortgage Program that offers members who are buying their first home a reduced rate on a mortgage that can either be used in conjunction with the FHLB program or on its own by those first time homebuyers who exceed the FHLB limit. Like the FHLB program, MECU’s First Time Homebuyer Program encourages a sound financial approach to home ownership, and both require that the buyer successfully complete a homeownership counseling program before settlement. There are also some differences between the two programs. The FHLB program requires that the buyer be owner occupants of the home and they must sign a five-year retention recapture agreement that states if they move out of the home in less than five years, they will repay the FHLB a prorated portion of the grant they received. The MECU program states that the buyer must plan to occupy the property as their principal residence. Mortgages exceeding 80% of loan-to-value require mortgage insurance, and the maximum percentage that can be borrowed is 95% of the value of the home. Three percent of the remaining 5% must come from the homebuyer. The remaining 2% may come from gifts or grants such as the FHLB program.

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