- change ups
City Triples Housing Help
GRAND RAPIDS — Because housing sales have slowed and the slowdown could have a negative effect on neighborhoods, city commissioners recently made two unusual exceptions to a program that helps qualified applicants buy selected homes.
Normally, the policy offers first-time homebuyers who meet the financial requirements $5,000 to use for a downpayment or closing costs when they purchase a house within the program’s target areas.
But commissioners tripled the amount of financial assistance to $14,999 and also waived the requirement that buyers be first-timers for 13 listed homes being offered by a trio of nonprofit community development groups.
“We have 13 properties on the market that we haven’t been able to sell,” said Connie Bohatch, city community development director.
Lighthouse Communities Inc. has five of the houses for sale and all are in the “Southtown” neighborhood, a southeast sector bordered by Wealthy, Fuller,
The New Development Corp., formerly the West Grand Development Corp., has four homes for sale on the northwest and northeast sides of the city. All have three bedrooms.
The Garfield Development Corp. also has four homes for sale on the southwest side in the
Bohatch said all are single-family homes in good condition. But because the houses are empty, the properties are at a greater risk for vandalism, theft and arson — all of which could hurt the neighborhood.
She said that increasing the city’s financial assistance to the program might be enough of an incentive to sell some of the homes. Bohatch added, though, that not everyone who qualifies may get the maximum amount of $14,999.
The assistance is in the form of a zero-interest loan. But if buyers live in the home for a minimum of five years, then the loan is forgiven. The note becomes payable on demand if the five-year time requirement isn’t reached. Funding for the homebuyer assistance program comes from the community development block grants that the federal government awards the city.
Buyers have to be pre-approved for a mortgage by one of the program’s 16 participating lenders, must contribute at least 1 percent of the purchase price, may not have household assets over $5,000, and must complete a homebuyer education program from one of three city-approved providers.
Potential buyers also have to meet certain income limits to quality. For instance, a single individual can’t have income exceeding $34,800, and a family of four can’t earn over $49,700 in a year.
The city has designated 13 specific target areas to receive the assistance, which mostly are older neighborhoods such as Stocking, Belknap, Eastown, Midtown and Creston.
Bohatch said another reason for making the “one-time” exceptions to the program is to help ease the financial burden of the nonprofit development groups who have renovated the houses and are making the mortgage payments.
Second Ward Commissioner Rick Tormala, who is leaving office at the end of the year, said the city needs to do everything it can to improve the local housing market.
Commissioners unanimously approved the exceptions to the assistance program, but limited the changes to the 13 homes. The community development office has the listing.