First and foremost you need to be low to moderate income to qualify, people with money stay away. Take a minute to think about that--how crazy is this!! Why?
There is a "soft" second for $50,000. What is a "soft" second mortgage? It is a mortgage that you do not have to pay back and is discharged, if you live in the house for a stipulated "affordability" period of time (mostly 15 years). In order to "qualify" for the "soft" second, you need to be low to moderate income. People with above moderate income will not qualify for the "soft" second mortgage.
In this example the CDC would receive $180,000:
- 130,000 in the form of first mortgage from a private "conventional" bank
- 50,000 from the City of Worcester in HOME funds.
The low to moderate home-owner pays back the first mortgage (130,000), but pays nothing on the "soft" second. What happens if this home-owner falls behind on their first and is foreclosed by the bank? If this occurs the stipulated "affordability" time period mentioned above has been violated and the $50,000 soft second is no longer "soft". The City of Worcester owes $50,000!!!!
Right now the City of Worcester has millions in soft seconds, resulting mostly from the sale of houses by the CDC's all around the City of Worcester. These "soft" seconds will become liabilities to the City of Worceter, if someone who is not low to moderate income takes title to the underlying property. In other words the City of Worcester has a vested interest to help a low to moderate income home-owner with a soft second stay out of foreclosure.
We can expect to see more and more monies being diverted to programs such as SAVE to help people in foreclosure. These programs main purpose, however, will be target home-owners in foreclosure, who have "soft" second mortgages to prevent them from becomiing liabilities for the City of Worcester.
5 comments:
Bill do we know how many of these soft 2nds the city is on the hook for .........Total dollar value and actaul number of mortgages.......???
It must be in the citys annual fin. report somewhere???
Time to cull the number of CDC's we have....how many non profits are building (or previoulsy built) this subsidized housing do we have in tthe city?
Mathew 25
Mains South
Oak Hill
East side
Worc Common Ground
Canal District
South Worc Improvement
Worc Housing Resourcces
I wonder how many CDC's a city like Sprigfield or Providence or Hartford has or even New bedford or Fall River
Have we become a magnet for non profit builders for some reason
Jahn:
A city councilor should request a report asking about this, but I highly doubt this will happen.
Yes, we have become a magnet for Community Development Corporations.
Bill
It is a shame that the units on Hollis St between Kilby and Gardner are empty. Hopefully they will get filled by summer.
I read the article about the grant money last week, but I now get the meat and potatoes of the deal by checking things out here.
Ms. C and I would love to check out the inside of those units just to see what you can get for $130K if you are low income.
Why not sell them to any individual regardless of income to get them occupied? Why fill up an area that is filled with low income families with more of the same. If there are people who earn more money and are willing to be urban pioneers and take a chance on an up and coming neighborhood shouldn't they be able to get a nice price break too?
An occupied building that is generating taxes and contributing to the neighborhood seems better than a block full of emptiness in the hands of the CDC.
4rilla:
If the houses were sold to someone who was not low to moderate income, the City of Worcester would be in violation of the terms of the grant monies and would have to pay them back.
In other words the City could not afford to sell these units to someone who is not low to moderate income.
Bill
i'LL YOU WHAT IS HAPPENING IN THE TOWNS as you approach boston where housing becomes more expensive as you move east toward boston..........the newly hired or about to be hired cops, firemen & teachers are getting this low income affordable housing b/c they are able to meet the income guidelines b/c their past year or 2 of employment may be have been at low wages or been sporadic, or some periods of unemployment, etc......so their earnings history is a little weak................plus sometimes they are req'd to reside in the community where they work and this is the only way they can afford it .......then they stay for a few years and move on to get away from the low income neighborhoods where they fight fires, teach & patrol.
This is esp so where so called Sec 40b housing is built .......b/c once you're into that kind of housing there are no add'l income checks and they can build equity that they can actaully get out of the property.
These housing units that Main South CDC is building...often they only sell the house and not the land that it sits on to the buyer.......so it basically takes on the characteristics of a trialer park.... i.e. you own the structure but not the land........so being forewarned is being forearmed before anyone gets involved in this foolishness......all those nice looking duplexes on Beacon SSt are set up this way......worst part is that at least in a trailer park you can hook up a truck to your home and move it elsewhere....where you could rent the land for less money.......but with these Beacon St duplexes......you're stuck there............
and when you do decide to sell you're forced to sell at below market value b/c you have to sell to another low income buyer............it's actually a great way to keep people from moving up the economic ladder b/c they cant build any real equity in their so called home (Winnabago) b/c they dont own the land and the land is what really appreciates over time and not nec. the structure or at least not to the same degree as the land plus you have maintain the structure & sell the structure at below fair market value.
This so called home ownership program is 99% bull++++ as far as I am concerned.......plus the real kicker is you have to pay the property taxes on the land that you don't even own !!!!
Here's a house (1/2 duplex), but you the so called homeowner are treated like a sharecropper b/c the feudal lord (Main South CDC) still owns the land. ANd main South and other CDC's are considered the good guys by everyone at city hall and at the buildings and permits depts (all kinds of special considerationns) and at the DPW (little or no charge for 1000's worth utility hook-ups)
Time to shut down these Cdc's before they inundate the city with any more low income housing.
Post a Comment