Partners, Volume 13, Number 1, 2003

Mississippi Home Corporation
Partners to Meet Housing Needs
By Nancy Montoya

Mississippi Home Corporation (MHC), the state's housing finance authority, recently launched several creative new programs in response to the housing needs of low-income residents. Building successful partnerships has been critical in delivering these innovative and effective services.

MHC views its mission as more than offering financing; it also aims to strengthen the state's affordable housing infrastructure in critical areas. In addition to administering standard programs such as Mortgage Revenue Bonds (MRBs), Downpayment Assistance and Low-Income Housing Tax Credits (LIHTCs), MHC has developed broader strategies to provide low-income housing.

By cooperating with nonprofit organizations, developers, homebuyer training agencies and intermediaries, the agency has been able to create programs such as Get on Track, Mississippi Affordable Housing Development Fund and Construction Loan Fund. MHC also works with Habitat for Humanity.

Creating innovative housing programs

Get on Track, a mortgage program for prospective homebuyers who are either credit impaired or lack a credit history, helps clients lease homes that they can then purchase after a predetermined lease period. This lease/purchase arrangement enables the family to establish or rebuild its credit reputation while a certain portion of rent is set aside as a future down payment. The program relies on a strong network of credit counseling agencies and knowledgeable property managers to move the families into homeownership.

In another effort to respond to its partners, MHC has created two new programs that provide both nonprofit and for-profit housing developers with the capital they need to develop affordable housing. Featuring flexible underwriting criteria and interest rates as low as 3.5 percent, the Mississippi Affordable Housing Development Fund and the Construction Loan Fund help entities that do not qualify for traditional bank loans find money to undertake affordable housing development.

MHC not only manages the portfolio of loans, but it also provides intensive, personalized, technical assistance that begins at the developmental phase and continues through completion of the project. Because they are engaged in the project from start to finish, MHC's staff protects the integrity of the loan while strengthening the expertise of the borrower.

Secondary market for Habitat mortgages

Habitat for Humanity is another organization that benefits from MHC's commitment to removing barriers that prevent its partners from producing decent, safe and affordable housing.

The Habitat Loan Purchase Program is simple in design but has a big impact for very low-income families. Habitat affiliates construct the homes, prepare the families for a mortgage and for homeownership, and close the initial mortgage. Once the family has made six months of timely loan payments, MHC purchases the loans while Habitat retains the servicing. This arrangement allows Habitat to quickly replenish its funds for housing production rather than waiting for an incremental payback. Since 1993, MHC has purchased more than $3.3 million in Habitat mortgages.

Other collaborations

MHC collaborates with other organizations in several critical areas: financial education through partnership with the Mississippi Jump$tart Coalition, wealth-building initiatives such as the Foundation for Mid-South's Individual Development Account program, and collaboration with banks to explore a multibank revolving loan fund.

(For more information about MHC, visit


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