(1) Funding for any qualifying matching share shall derive from any source, public or private, other than appropriations, reserves or dedications utilized to fund the state and local portions of the loan fund pool.
(2) The interest rate charged to the borrower of such funds shall not exceed the prevailing market rate of interest for residential mortgages and shall not be less than a rate which will produce a blended mortgage interest rate of three percent (3%) applicable to the total loan amount.