HF 2341

as introduced - 86th Legislature (2009 - 2010) Posted on 02/09/2010 02:03am

A bill for an act
relating to taxation; providing a tax credit advance loan program; proposing
coding for new law in Minnesota Statutes, chapter 462A.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [462A.2094] TAX CREDIT ADVANCE LOAN PROGRAM.
new text end

new text begin The agency, as defined in section 462A.03, subdivision 6, must develop the tax
credit advance loan program. The loan program provides second mortgages for first-time
home buyers to finance loans for up to $8,000 of the home purchase price. Tax credit
advance loans must be used in conjunction with a conventional loan at a 30-year fixed
rate mortgage and require that the home buyer file for a federal tax credit for first-time
home buyers and use the credit refund to repay the loan. If the tax credit advance loan is
repaid when due, the homeowner will be required to pay no interest, although reasonable
servicing fees may be required to be paid. If the tax credit advance loan is not paid when
due, principal and interest payments to repay the loan over ten years begins. The agency
must issue tax-exempt bonds to fund the program. The program shall remain in effect
during the time when the federal tax credit is in effect.
new text end