CA Housing Finance Agency offers 40-year mortgages to 1st time buyers

State offering 40-year mortgages for first-time homebuyers
Silicon Valley/San Jose Business Journal - 1:29 PM PST Wednesday

http://www.bizjournals.com/sanjose/stories/2006/03/13/daily32.html?f=et79&hbx=e_du

A state agency that helps first-time homebuyers announced Wednesday the introduction of a 40-year fixed mortgage. The California Housing Finance Agency already offers 30-year fixed and 35-year interest only mortgages. All three mortgage options are offered at below market, fixed interest rates.

Last year, CalHFA expanded its mortgage products by introducing the interest-only loans, which now comprise more than a third of all the agency's loans. "The response to our expanded product offering has been tremendous," said Theresa Parker, the agency's executive director, in a news release. "While the 40-year mortgage may not be right for everyone, it does offer first-time homebuyers another way to help achieve their goal of homeownership."

The fixed rate on the 40-year mortgage will initially be 5.75 percent, about one point below average market rates for 40-year mortgages. Loans from CalHFA are available to low- and moderate-income first-time homebuyers who meet CalHFA income limits and who are buying homes that fall at or below CalHFA sales price limits, which are pegged to home prices in each region.

leaves people paying mortgages well into their 70s and 80s.

Unless they sell and buy cheaper when they quit working.

The banks are making a killing on increased house prices and financing.