§ 6-26-302 - Home loan program. - Arkansas Statutes

6-26-302. Home loan program.

(a) The Board of Trustees of the Arkansas Teacher Housing Development Foundation shall develop, implement, and administer a home loan program to provide special home loan financing to high-performing teachers who choose to teach in high-priority school districts.

(b) (1) To the extent allowed by the available loan programs or funding, the following financing options shall be included in the home loan program:

(A) A conventional mortgage available for the purchase of an eligible home, at an interest rate not to exceed six percent (6%) for a thirty-year loan;

(B) A second mortgage, not to exceed twenty percent (20%) of the total cost of an eligible home and at an interest rate not to exceed four percent (4%); and

(C) (i) A forgivable loan equal to not more than ten percent (10%) of the total cost of an eligible home, which is intended as assistance with the down payment.

(ii) The forgivable loan shall be interest free if the high-performing teacher fulfills his or her obligation with the high-priority school district.

(iii) The high-performing teacher shall receive one-fifth (1/5) credit on the forgivable loan for each year that he or she teaches in the high-priority school district.

(2) (A) The Director of the Arkansas Teacher Housing Development Foundation shall provide a report to the House Interim Committee on Education and the Senate Interim Committee on Education as to whether the loan program as provided in this section has been and is being provided to high-performing teachers or whether the loan program has been modified due to the available loan programs or funding during any calendar year.

(B) (i) The report shall include the following:

(a) Data on the terms of each loan provided under this section; and

(b) Any other data that is necessary for the House Interim Committee on Education and the Senate Interim Committee on Education to assess the effectiveness of the loan program.

(ii) The report shall clearly indicate which loans provided under this section meet the requirements of this section and which loans have been modified due to the available loan programs or funding.

(c) (1) A high-performing teacher who chooses to teach in a high-priority school district has the option of using all or part of the financing options available under this section.

(2) A high-performing teacher who chooses to teach in a high-priority school district may exercise the right to the financing options available under this section for a maximum of five (5) years after choosing to teach in a high-priority school district.

(d) (1) If the high-performing teacher stops teaching in the high-priority school district for any reason within five (5) years after exercising an option for a conventional mortgage or second mortgage under this section, then the remaining balance on the conventional mortgage or second mortgage shall become due and payable within three (3) months of the termination of the high-performing teacher's service to the high-priority school district.

(2) (A) If the high-performing teacher stops teaching in the high-priority school district for any reason within five (5) years after exercising an option for a forgivable loan under this section, then the remaining balance on the forgivable loan shall become due and payable within three (3) months of the termination of the high-performing teacher's service to the high-priority school district.

(B) The board may develop a supplemental loan program that converts the forgivable loan into a conventional loan for high-performing teachers who do not fulfill their obligation.