Wis. Stat. § 234.665 — WI Code / Chapter 234 / Section 234.665
Section 234.665
Status: in_force

1. Subject to pars. (b) to (g) , the authority may issue a loan to an eligible applicant certified by a qualified organization under sub. (4) .

2. The authority may not charge interest for any workforce home loan, and the loan term shall be one of the following:

a. If the applicant has an annual household income that is more than 80 percent of the area median income, 15 years.

b. If the applicant has an annual household income that is 80 percent or less of the area median income, 30 years.

c. If the applicant qualifies for payment deferral under par. (f) , 40 years.

2m. The authority may not charge any fee in connection with a workforce home loan.

3. A workforce home loan may be prepaid in whole or in part at any time without penalty.

4. No workforce home loan shall be forgivable in whole or in part.

5. Each workforce home loan shall be secured as a 2nd lien real estate mortgage.

6. The authority shall use all repayments of workforce home loans to fund additional workforce home loans under this section.

(b) The authority may issue a workforce home loan only for the purpose of providing gap financing to supplement a conventional mortgage for the purchase of a single-family residence in this state that is a new construction and that will be the eligible applicant’s primary residence.

(c) The authority may not issue a workforce home loan that exceeds the lesser of the following:

1. $60,000, adjusted annually beginning on April 10, 2026, by the average compounded annual percentage increase in the sale price of all residential housing in this state, as determined by the authority.

2. Twenty-five percent of the purchase price or fair market value of the home, whichever is less.

(cm) In each biennium, the authority shall set aside 25 percent of the total moneys deposited in the fund under sub. (2) (a) in that biennium for loans awarded under this section for the purchase of residences within a rural area.

(d) If the authority issues a workforce home loan to an eligible applicant whose household compliance income is 100 percent or less, but more than 80 percent, of the area median income, the repayment of principal on a monthly basis shall commence on the first day of the 2nd month following the issuance date of the loan, amortized over 15 years.

(e) If the authority issues a workforce home loan to an eligible applicant whose household compliance income is 80 percent or less, but more than 60 percent, of the area median income, the repayment of principal on the loan shall be deferred for 60 months following the issuance date of the workforce home loan after which time the repayment of principal on a monthly basis shall commence, amortized over 25 years.

(f) If the authority issues a workforce home loan to an eligible applicant whose household compliance income is 60 percent or less of the area median income, the repayment of principal on the loan shall be deferred until the first-lien real estate mortgage loan on the home is paid in full after which time the repayment of principal on a monthly basis shall commence, amortized over 10 years.

(g) The total amount of unpaid principal on a workforce home loan shall become due and payable upon the occurrence of any of the following:

1. The recipient of the workforce home loan sells the home.

2. No recipient of the workforce home loan resides in the home as a primary residence.

(6) Subordination to new first mortgage. The authority shall subordinate an outstanding workforce home loan to a new first mortgage loan obtained by the recipient of the workforce home loan, using the same documentation requirements and charging the same subordination review fee as for the authority’s other 2nd mortgage loan programs, if the authority determines that all of the following apply:

(a) The home continues to be the primary residence of any recipient of the outstanding workforce home loan.

(b) The combined loan-to-value ratio, calculated using the sum of the amount of the proposed new first mortgage loan and the outstanding balance of the workforce home loan, divided by the fair market value of the subject property at the time of the subordination request, as determined by the authority, is equal to or less than the combined loan-to-value ratio at the time the workforce home loan was first issued, calculated using the sum of the conventional first mortgage loan used to purchase the residence and the amount of the original workforce home loan, divided by the original fair market value of the subject property at the time the workforce home loan was first issued.

(c) The proposed new first mortgage loan is a fully amortizing, fixed-rate qualified mortgage loan with a term of 30 or fewer years, consistent with Regulation Z under the federal Truth in Lending Act, 12 CFR 226 .

(d) The workforce home loan recipient continues to satisfy sub. (4) (b) 3. , 4. , 5. , and 7.

History: 2025 a. 239 .