NMHC may exceed target of 1,000 housing loans

The Northern Marianas Housing Corporation is hoping to exceed the targeted number of approved home loan agreements before year-end, after failing to meet its goal of closing 1,000 mortgage applications before the Year 2000 rollover.
Commonwealth Development Authority Executive Director Marylou S. Ada said 100 home loan agreements have already been approved by the housing corporation since the beginning of the new century.
NMHC has processed and approved loan applications for the expansion of 45 houses and the construction of at least 51 new housing units at the Sugar King II.
Based on the trend recorded by the housing corporation during the first three months of the year, Ms. Ada is confident NMHC will be able to surpass its target to close 1,000 mortgage agreements by end-December 2000.
NMHC was forced by economic slowdown and banking institutions’ conservative attitude toward giving out advances due to Article 12 restrictions to lower by 40 percent the number of home loan agreements it projected to close by end-December 1999.
Due to the recession, housing officials said most home loan applicants fail to satisfy the minimum salary requirements set by financial institutions due to widespread reduction in work hours which reflected in the employees’ paychecks.
Ms. Ada said there is an increasing demand for home ownership among indigenous population in the Northern Marianas, resulting from intensified campaign by the NMHC that includes partnership with private banks to provide housing mortgages.
CDA has been receiving an average of 20-40 housing loans every month, making CDA a major instrument in ongoing housing projects which include the construction of almost three hundred residential units
Primarily because of its aggressive promotion of the merits of home ownership, CNMI is in the brink of witnessing a burst of growth in the construction sector.
In fact, the significant increase in the volume of real estate loans processed and approved by commercial banks and the development authority last year was spurred by a bigger demand for home refinancing because of the lower interest rates.
Interest rates have dropped from 10 percent to 11 percent two years ago to between eight percent and nine percent now.
NMHC is now processing 300 housing loan applications with almost half of it expected to be closed in the next couple of months while NMHC targets to approve the rest by end-December this year.
Despite its limited funding, NMHC was able to commit over $4 million for the construction and rehabilitation of public housing, and landscaping of grounds in 1996.
When the Loan Purchase Agreement was sealed with the Guam Savings and Loan in 1993, over 60 families have been assisted with construction, renovation and refinancing of their homes by end-1996.