Oregon Bond Loan

What is the Oregon Bond Loan?
Oregon Housing and Community Services periodically issues mortgage revenue bonds to fund lower than market interest rate mortgage loans to help households in Oregon buy their first home.  These loans are 30 or 15 year fixed rate mortgages.  There are two programs offered:
  • Rate Advantage – 3.250% Interest Rate
  • Cash Advantage – 3.750% Interest Rate
    The Cash Advantage program will provide cash assistance equal to 3% of the loan amount towards the buyer’s closing costs/prepaid items.  This can substantially reduce the cash needed at closing.  However, these funds cannot be used towards the down payment requirements.
Loan Types
  • FHA insured – 3.5% down payment
  • USDA (rural property)  – 0 % down payment
  • Conventional – 20% down payment
Eligible Homebuyer
  • Borrower/Co-Borrower must be first-time homebuyer(s) – except in “Target Areas”
  • The “annualized gross household income” cannot exceed the Program Limits established by Oregon Housing
  • Must occupy the property as their primary residence
  • Must not have been discharged from a bankruptcy within the past two years
  • Must not have had a real estate foreclosure within the last five years
Eligible Property
  • Property must be located in Oregon
  • Newly constructed or existing homes
  • Qualified condos, townhomes, and manufactured homes may be eligible
  • Purchase limits vary by county
IRS Recapture Tax
The federal recapture tax applies if and only if…  
  • The home is sold within the first nine years of ownership, AND
  • The borrower makes a profit on the sale of the home, AND
  • If borrowers’ adjusted gross income exceeds the applicable income for the year they sell
Most borrowers do not have a recapture tax liability.  

Maximum recapture (6.25% of the loan amount) is adjusted by years owned:

Income Limits

Purchase Price Limits

Targeted Areas
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Please click here to view the full image and zoom. This image is for display purposes only and may not be 100% accurate. To verify that a property is located within a Target Area, please use Oregon Bonds website.

More Information
For more information about the Oregon Bond Loan or other financing options, please contact Clayton Scott.

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