![]()
As you all know, we got our house early last year through a county program to help low-income people and families be able to buy a first house. The way it's designed, those looking for bargains to flip wouldn't touch this deal with a ten-foot pole. It has worked out so well for us and the program as a whole has been incredibly successful. I was told that they were able to get a single mom with four children and a minimum wage job into a four-bedroom house and she's happy as a clam. The thing really works.
Basic elements of the program:
• The county buys a problem property and fixes it up nice to be worry-free for a while. Nothing fancy, but dependable.
• They put it on the market but retain ownership of the land, which they will lease to you for $30 per month. It's a 99-year lease. So you are only buying the house, through a specific lender that they work with (Our home was appraised at $265k, but we only paid $176k).
• To be part of the program, you need an income level between, I think it was around $20k and $52k (We were barely under the maximum).
• No down payment is required, and many purchase costs and fees are also covered (We only had to pay the escrow fee).
• The mortgage comes with a 1% discount off the going interest rate.
• The buyer must live in the house at least ten months out of the year.
• The buyer can't sell the house for five years after purchase.
• If the owner wants to sell the house after that, the program gets first option to buy it back.
• Whether they buy it back or someone else does, they get 75% of the equity and the seller gets the remaining 25%. So these homes turn house flippers off instantly.
• Their share of the equity and the land lease are what allows the program to buy new properties. The program has pretty much been paying for itself.
• Our total out of pocket, minus moving costs, was around $3,500. AND just yesterday we got a refund check from the escrow company for $975.00!
I may have forgotten a couple particulars, but you get the idea. This program was absolutely PERFECT for us, and it is for other low-income who are truly just looking for affordable housing they can actually own.
It really seems to me that this program or something very like it could be scaled up on a national level.
So, my question is..... Why couldn't it?
(0.0 from 0 votes)
