The Register-Herald, Beckley, West Virginia

Local News

March 28, 2008

Official says W.Va. housing market strong

By Fred Pace

Joe Hatfield, the state housing fund’s executive director, says West Virginia’s housing market remains strong despite a national mortgage crisis.

“West Virginia has not had the level of foreclosures that we have seen in other states,” Hatfield said Thursday. “We have seen some foreclosures in state’s Eastern Panhandle region, but overall the state has not had any increase in the number of foreclosures during the national slowdown in the housing market.”

Hatfield credits the state’s lending industry and a more diversified state economy.

“Most of the types of housing loans in West Virginia are different from the tricky mortgages we have seen in other states,” he explained. “Yes, we’ve have some adjustable mortgages, but most of those have been underwritten.”

The West Virginia Housing Development Fund has approximately 25,000 home loans, most with moderate- to low-income buyers.

“We have not seen any increase in the number of foreclosures out of our portfolio,” Hatfield said. “We have weathered the national crisis very well in West Virginia.”

Hatfield says there are a number of bills before Congress regarding the national mortgage crisis.

“But we don’t know what incentives or money will be available to states to assist homeowners in crisis,” he said. “We will have to wait and see what, if anything, Congress does about it.”

However, Hatfield says Gov. Joe Manchin didn’t want to see any slowdown or impact in the state’s housing industry, so he encouraged the West Virginia Housing Development Fund to take steps to stimulate new home purchases and help families with sub-prime mortgages avoid foreclosure.

“We want to keep the market excited, so we put $20 million in 30-year mortgage money at a 4.99 percent interest rate to keep people coming and keep the market vibrant,” Hatfield said.

Other proposed changes include allocating an additional $2.2 million to assist new buyers with closing costs. Hatfield said that as a result of the additional allocation, a total of $5 million would be available for the closing cost assistance program.

“The governor has also asked us to develop a strong homebuyer, credit and foreclosure counseling system across the state,” he said. “We are seeing a good network of counselors being developed to serve every county. They will be able to offer homebuyer counseling to help families with existing sub-prime loans avoid foreclosure.”

Other proposed changes include pricing adjustments to encourage the utilization of 97 percent and 100 percent mortgage financing offered by Federal Home Administration, Veterans Administration and U.S. Department of Agriculture programs, launching an advertising campaign to highlight the affordable and attractive features of the housing fund’s programs.

For families with sub-prime mortgages, the housing fund staff is recommending directors provide $350,000 in matching funds for borrower assistance programs and provide technical assistance to the Affordable Housing Trust Fund for loan review and counseling services.

Hatfield says the changes encouraged by Manchin and recommended by the housing fund staff should produce $170 million in loans for 2008 and help our mortgage industry remain healthy.

“We don’t want to see any slowdown or impact in West Virginia’s housing industry,” he said.

— E-mail:

fpace@register-herald.com

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