Oregon House Bill 3035 codifies flex lending to aid low-income homeownership

In a pivotal meeting held by the Oregon Senate Committee on Housing and Development, lawmakers discussed House Bill 3035, a significant piece of legislation aimed at enhancing homeownership opportunities for low-income families. The bill, presented by Nathan Clark from Oregon Housing and Community Services (OHCS), proposes several key changes to existing housing statutes that could reshape the landscape of residential lending in the state.

House Bill 3035 seeks to establish household income limits for individuals benefiting from residential housing developed with state financing. Notably, it removes previous borrowing limits for home repairs and improvements, allowing low-income households greater access to necessary funds. The bill also expands the definition of residential loans to include refinancing options, even if the original loan was not issued by OHCS. Importantly, the legislation is projected to have no revenue impact and minimal fiscal implications.

Clark emphasized the historical context of OHCS's lending programs, tracing back to the establishment of the Oregon Residential Bond Loan Program in 1977. This program was the agency's sole mortgage lending initiative until 2018, when it began developing a new approach known as flex lending. This modernized lending platform aims to provide lower rates and better terms for low-income Oregonians, ultimately reducing risk for the agency.

The flex lending initiative has already seen success with the launch of products like Next Step and First Home, which have been instrumental in helping more Oregonians achieve homeownership. As the program matures, the Department of Justice has recommended codifying flex lending into state law, aligning it with the established Oregon Residential Bond Loan Program.

The committee meeting concluded without any public testimony, but the discussions highlighted a collaborative approach between OHCS and private lenders, aiming to address the ongoing housing crisis in Oregon. As the state grapples with affordability challenges, House Bill 3035 represents a proactive step towards making homeownership more accessible for those who need it most. The committee's next steps will involve further discussions on the governor's priority housing bills, signaling ongoing efforts to tackle housing issues in the state.