Most Americans cannot fund their education on their savings, so they turn to student loans, grants and scholarships. Many college graduates are lucky enough to find a high-paying job, but others are only left with a diploma. The burden of student loan debt is way too much to bear, even with a decent income. U.S. student debt has topped $1 trillion, with an estimated $3,000 student debt accrued every second.
Maryland has launched a new program that may just be the solution for college graduates, who are on the market for a new home. The Department of Housing and Community Development (DHCD) SmartBuy program is aimed to help homebuyers purchase specific properties through the state. All qualified buyers participating in the program will have their student load paid off.
The Community Development Administration purchased the properties after foreclosure, using the Maryland Mortgage Program. According to Sara Luell, DHCD spokeswoman, approximately $10 million has been allocated to the SmartBuy program, enabling 40 to 50 households to participate. A $200,000 three-bedroom home in Bel Air was the first sale through the SmartBuy program, purchased by Jasmine Townsel and her fiancé, Brian Hawkins of Bel Air.
A down payment of at least 5 percent is required and the remainder of the purchase must be financed through a selected lender. The buyer’s student loan, which can be not more than 15 percent of the sales price, will be paid off through a second mortgage with a zero percent interest rate. This is a 5-year forgivable loan note.
Lieutenant Governor Boyd Rutherford said, “ “With the launch of SmartBuy, Maryland is among the first in the nation to actively address student debt as an obstacle to homeownership.” There are currently 15 homes available through the program, ranging in price from $70,000 up to $310,000.
To learn more about the Maryland SmartBuy Mortgage Program visit the DHCD website.