Fiscal Note
Funding of $250,000 in Federal HOME funds is available in the Housing Development Fund to cover the costs of this project.
Title
Authorizing the use of Federal HOME funds in an amount not to exceed $250,000 to provide additional down payment assistance to qualified homebuyers as part of the City's American Dream Down payment (ADDI) program, and authorizing the Mayor and Clerk to execute any associated agreements as required.
Body
The Federal Department of Housing and Urban Development (HUD) initiated a funding stream in 2004 through the Federal HOME program for larger local jurisdictions to provide down payment assistance to eligible homebuyers (80% of the area median income and below). The Council approved local guidelines for the program in 2005 and the Community Development Division began making these loans in July 2005. During the first four years, under the policy guidance of the CDBG Committee, the Division has committed over $1.2 million to serve 151 households.
Homebuyers are provided a loan in the amount of 6% of the purchase price not to exceed $10,000. The loan is a long term deferred loan and is due and payable when the property is sold or no longer the primary resident of the buyer. The repayment is based on the loan amount plus a proportional share of equity. The average ADDI loan amount is $8,299.
PROJECT:
The Community Development Division has worked with realtors, lenders, the CDA Unit, community-based groups and associations to market the program, and leverage other resources for families. The Division expects to commit all of the remaining HOME ADDI program funds by the end of December, and would be compelled to shut down the program until additional funds are allocated. At this point in the 2009 program year, the Community Development Division concludes that there are sufficient funds within the Housing Development Fund to provide an additional level of support to the ADDI program, and meet the estimated level of demand f...
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