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New loan program to help employees afford housing

January 26, 2024

The Office of the Treasurer hosted an information session on January 16 in Cram Alumni House to discuss the College’s forgivable loan program for employees buying a home within 40 miles of campus. Senior Vice President for Finance and Administration & Treasurer Matt Orlando announced the program in an email to all employees on December 7.

The program offers 10-year forgivable loans to employees who haven’t owned a home in the area in the last five years. The loans cover up to 10 percent of the home’s purchase price, to a maximum of $50,000.

The information session was hosted by Orlando, Procurement & Risk Manager James Kelley and Vice President for Human Resources Tama Spoerri. The three reiterated information about the program that is on Bowdon’s website, such as facts about which employees are eligible, how to apply and how the loan will affect an employee’s taxes.

Lily Prentice, the theater and dance costume shop manager, has rented an apartment in Portland for the past few years but said that the loan program has made her much more likely to buy a house.

“Every time my lease is renewed, I expect a hike in my rent,” Prentice said. “Now that I’m thinking of buying a house, I’m thinking of a situation that feels so much more secure, and making a monthly payment that is investing in myself, rather than someone else’s property…. This program just feels like it makes the whole process so accessible in a way that it just wasn’t to the folks that they’re targeting.”

Orlando said at the session that the amount forgiven on a loan each year will factor into the employee’s taxes.

“If the loan is $50,000, $5,000 is forgiven at the anniversary date of your closing each year,” Orlando said. “One thing to remember is [the loan is] going to show up on your W-2 that year—the principal, the forgiven $5,000, plus the interest—even though you’re not paying anything. We still need to track it for the IRS…. And so, on your W-2 for that year, it will show as taxable income.”

The College is partnering with Bath Savings Institution and Kennebec Savings Bank for the program. Kelley said that he doesn’t recommend one bank over the other but that he encourages employees to research both banks before making a decision.

“Both banks have said [they] will talk with anyone that is interested in buying a home that would qualify under this program,” Kelley said. “Some banks have more flexibility than others on the down payment.”

Kelley also said that the interest rate of the loan will stay the same throughout the 10-year period. The current rate is 4.2 percent for the program, Orlando said.

“The interest rate on this loan is at the applicable federal rate, which is generally lower. And the importance of mentioning that is that will be the rate for that loan for the entire period of the loan,” he said.

Orlando also mentioned that the developer GreenMars is working on a housing project that might be relevant for employees looking for housing near the College. The project will construct and sell 20 homes on McKeen Street that cost $325,000, a relatively low figure for Brunswick housing.

“It’s a private developer…. They plan to break ground pretty soon. It is first-come, first-serve. The $325,000 is not a competitive process. It’s literally whoever makes the deposits first,” Orlando said.

Home purchases made between March 1, 2024 and February 28, 2026 will be eligible for the loan. Orlando said the College will consider renewing the program when it expires in 2026.

“Don’t anticipate or expect that it’s going to be there on March 1, 2026,” Orlando said. “We’re not guaranteeing it. We’re gonna see how this goes and tweak it if we need to, or [if] the market has changed. We’ll see how that goes.”


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