Governor Ed Rendell says a state-federal partnership will boost Pennsylvania’s housing market by providing 11-thousand new mortgages to home buyers.
Rendell says the Pennsylvania Housing Finance Agency will use federal funding to offer 30-year fixed rate mortgages with interest rates around five percent.
"Low-interest, fixed rate loans are exactly what we need today. They’re the opposite of the kind of sub-prime, interest only adjustable rate loans that got so many home owners in trouble in the first place."
State bond sales will also finance 50 million dollars in loans aimed at home construction. Rendell says he’s also expanding a program that offers 6-thousand dollar interest-free loans to first-time homebuyers. In all, Rendell says the effort will cost 1.2 billion dollars.
More than 18-thousand Pennsylvania residents are in foreclosure right now. Rendell says the state’s median home price dropped by more than six percent last year.