State Targets Severn for Homeownership Program

A portion of Severn has been targeted by the state of Maryland for a special program designed to spur homeownership.

Anyone looking to buy a home in and around the Pioneer City community of Severn will be eligible for a reduced interest rate of 2.875 percent on a 30-year fixed mortgage through the Maryland Mortgage Program.

The state has about $30 million set aside for the program, and will continue offering the low interest rate until the money runs out. State housing officials stressed that applicants do not need to be first-time homebuyers.

The targeted area is known as census tract 7401.05, and includes most of the area on the east side of Reece Road and Pioneer Drive. It is the only portion of Anne Arundel County eligible for the program.

According to census data, the targeted section includes about 1,300 homes, about 10 percent of which are vacant.

Bill Ariano, deputy director of the Community Development Administration in the Maryland Department of Housing and Community Development, said vacant homes can damage the area. 

“The pain people are feeling right now is that when you have a house that’s vacant, no one is paying taxes on it, it’s pulling down the area,” said Ariano. “Homeownership has always been traditionally a great way to provide stability to families and neighborhoods and subdivisions. It’s important to reinforce that fact.”

Across the state, there are targeted areas in 14 counties, including all of Baltimore City. Targeted areas were picked based on income levels and rates of homeownership and foreclosures.

The Maryland Department of Housing and Community Development announced the low-interest loan program Thursday along with a number of other initiatives designed to increase homeownership in the state and assist anyone who is short selling or foreclosing.

Those looking to buy a foreclosed, abandoned or short sale property in a targeted area can get $25,000 in assistance under the Neighborhood Stabilization Program.

In non-targeted areas, anyone looking to buy a foreclosed home can get interest rates at 0.75 percent lower than the average interest rate offered by the Maryland Mortgage Program. The program has a floor of 3.25 percent and would save about $100 to $110 monthly on a $175,000 home.

“We want to get as many houses that have been foreclosed on back on the tax rolls and just as importantly, stabilize neighborhoods," Ariano said.

Ariano said the programs could help speed up the process of moving a house from foreclosure to having a new owner. Realtor Magazine reported that typical foreclosures in Maryland take 618 days to complete, making it one of the five slowest states in the country.

“No one likes to see a person lose their house, and that’s why Maryland has put in place certain laws that provide protection. But once there’s resolution to that, it’s important we get those houses back to a productive level again,” Ariano said.