Department of Defense

Mortgage Interest Incentive - Everybody Wins


1) Reduced transportation time

2) Reduced automobile emissions

3) Reduced gasoline consumption

4) Less employee stress

5) Less employee turnover

6) Greater job satisfaction

7) Government will profit on loans


A common situation at most facilities is that many employees drive great distances to and from work. This is because housing can be found cheaper in certain areas or even by living out of state. A solution that can both keep employees off the highway and allow them to spend more time with their families would be to provide them the opportunity to purchase a primary residence with a significantly reduced mortgage interest rate.


This rate would be provided if the employee purchased a home within an X mile radius of the work site. For example, an employee may currently commute 45 minutes each direction from home to work. This may be because housing is simply unaffordable to that employee any closer. However, if the government were to offer the employee a mortgage interest rate of 2% if they bought a home within 5 miles of the work site, this would lead to all of the benefits described earlier. Their commute might now only be 10 minutes, freeing up over one hour and allowing them to leave later in the morning and return home earlier. Or they could then be available to do other activities that before were prevented by lack of time.


The interest rate could fluctuate based on the current market rate (perhaps current rate - 2.5%).

The current rate is now about 4.5% for a 30 year fixed loan. The employee could choose to buy a $300,000 home anywhere and pay about $1520 on the mortgage each month. Or, under this proposed program, they could now pay the same amount per month, but purchase a $411,000 home much closer to work.


There would need to be a requirement for the employee to continue to work for the agency or risk having to pay back the money, similar to what is already in place for taking academic courses or student loan repayment. However, with a reduced commute and more free time, an employee would be less likely to want to leave their job anyway. And on top of all of this, the government themselves would be profiting on the mortgage loan. Seems like everybody wins.



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Idea No. 17405