Legislation proposes new 20-year mortgage for first-time home buyers

Legislation proposes new 20-year mortgage for first-time home buyers

Legislation proposes new 20-year mortgage for first-time home buyers
In another creative way to spur first-time homebuying in the U.S., lawmakers have introduced another bill in the U.S. House of Representatives called the “Low-Income First Time Homebuyer (LIFT) Act”. The legislation would create a program through the Department of Housing and Urban Development that would help first-time homebuyers get a low fixed-rate 20-year mortgage.

To qualify, borrowers would need to be first-time and first-generation homebuyers with an income equal to or less than 120 percent of the area median income. The program would allow these buyers a subsidized mortgage rate so that their monthly payments on a 20-year loan would be equal to that of a 30-year mortgage.

The bill has been promoted by its Democratic sponsors as a way for middle-class families to build wealth and achieve economic stability.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 2.75 percent and 15-year rates are near 2.00 percent.

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