PROVIDENCE, R.I.—Rhode Island’s below-market mortgage program has exhausted its second round of funding just three months after its statewide expansion, highlighting strong demand for affordable home financing, according to reporting by the Providence Journal.
The RI AnchorHome program, administered by the Rhode Island Treasurer’s Office, began as a pilot program in December 2025 before expanding in April. The second funding allocation, which supported 89 mortgages, has now been fully committed, the newspaper reported.
Under the program, participating banks offered mortgage rates starting at 3.99%—well below prevailing market rates—and waived the requirement for private mortgage insurance (PMI), providing significant savings for qualifying borrowers.
To support the loans, the Treasurer’s Office committed $81 million in state deposits to participating financial institutions. The funding included an initial $60 million allocation followed by an additional $21 million approved in April.
Depleted Within a Month
Treasurer’s Office spokeswoman Carla Rojo told the Providence Journal the additional funding was depleted within a month.
The program is an expansion of the state’s longstanding Community Deposit Program, which traditionally places state deposits with banks and credit unions to support qualifying loans of less than $250,000 for small businesses.
Under RI AnchorHome, the state deposits remain in participating financial institutions and must be renewed annually. After five years of on-time mortgage payments, the Treasurer’s Office may either reallocate the deposits to support new mortgages or withdraw the funds, although state liquidity needs take priority, according to program guidelines. The deposits must earn the state a minimum annual return of 2.5%.
Potential Third Phase
Rojo told the newspaper the Treasurer’s Office is now evaluating a possible third phase of the program.
“Right now, we are exploring what Phase Three might look like and how we can continue to better serve our communities,” she said.
According to the Providence Journal, the program requires substantial state deposits to support each mortgage. With $81 million backing 89 loans, the average state deposit amounted to roughly $910,000 per mortgage.
The Monthly Savings
The newspaper reported that the program’s below-market rates generated substantial monthly savings compared with conventional mortgages. For example, a $500,000 mortgage at a market rate of approximately 6.5% would carry a monthly principal and interest payment of about $3,160, compared with roughly $2,384 at the program’s 3.99% rate—a savings of approximately $776 per month, or more than $9,300 annually.
The Requirements
Demand remained strong despite strict eligibility requirements, according to the Providence Journal. Borrowers were required to meet several qualifications, including:
- Household income no greater than 110% of the area median income.
- Maximum loan amounts of $525,000 for a single-family home and $575,000 for a duplex.
- Properties limited to one- or two-unit homes.
- First-time homebuyer status.
- No ownership of other residential property at closing.
- A minimum credit score of 660.
- A maximum debt-to-income ratio of 50%.
- Liquid assets limited to no more than 12 months of housing expenses or retirement accounts valued above $500,000.
Despite those restrictions, the rapid depletion of available funding underscores continued demand for affordable mortgage financing
