1st time home buyer and other promotions

[Rick Uldricks]

Does Lakewood offer any incentives for 1st (or 2nd, 3rd...)- time home buyers - loans, tax abatements, etc.?

If so, where can information about these programs be found?

[DougHuntingdon]

Here is something I found on the city's site--might be a start

http://www.ci.lakewood.oh.us/dept_planning_cdbg_6.html

I also believe Rockport has a low interest rate and/or tax abatements. Then again, if you pay up to $400,000+ for what in my opinion is worth $100,000+ who cares if you get a reduction on your property taxes LOL?

Doug

[dl meckes]

Rick-

Check out the Division of Community Development: http://www.ci.lakewood.oh.us/dept_planning_cdbg.html

216.529.HOME (4663)

They can tell you about different programs that are available.

[DougHuntingdon]

Editorial comments

Note on the first time home buyer, it APPEARS that you must make below a certain income $x in order to qualify. Does anyone have a problem with this? While $x is nowhere near minimum wage, it appears to be directly or indirectly discouraging those who make more than $x from buying a home in Lakewood. Also note that a large % of city workers make more than $x (the ones on Bill Call's list make twice or thrice $x).

They also are encouraging single parent homes, which I think is offensive. To me, single parent means single never married. Perhaps in a legal way for this program, it means single never married, divorced, or widowed, but that is beside the point. Regardless, this appears to be an attack on married (or unmarried, including LGBT) couples, with or without children.

and what is a displaced homemaker? one who is fired from the job of being a homemaker??? Who comes up with this terminology? Someone with a PhD in Sociology or Urban Affairs?

Add this post to what is WRONG with Lakewood. What's next, free $5000 to add to your downpayment if you have a crackbaby???

Rick, good luck if you are considering buying a home. Perhaps you may need to divorce your wife, if married, and maybe ask for a demotion if you make a little too much money in order to qualify for the program.

Doug

PS I realize this may be a federal program and not really a city program, but it doesn't change the argument.

[Bill Call]

They also are encouraging single parent homes, which I think is offensive. To me, single parent means single never married. Perhaps in a legal way for this program, it means single never married, divorced, or widowed, but that is beside the point. Regardless, this appears to be an attack on married (or unmarried, including LGBT) couples, with or without children.

and what is a displaced homemaker? one who is fired from the job of being a homemaker??? Who comes up with this terminology? Someone with a PhD in Sociology or Urban Affairs?

Add this post to what is WRONG with Lakewood. What's next, free $5000 to add to your downpayment if you have a crackbaby???

Local banks offer financing under this City program. I think the City offers up to $10,000 for a single family home.

Doug, you are right on about his one. A program designed to encourage people to buy a home in Lakewood has turned into someones social engineering project.

One of the big problems with this program is that you have to be borderline poor to be eligible. Which means there is a good chance that the person buying the house will barely be able to afford the payments let alone afford maintenance and improvements.

The incentives on 2 family houses are up to $15,000. It's a good idea except the new owners keep the money after ten years and convert the property back to absentee landlord status.

[Rick Uldricks]

This program doesn't seem to make good sense.

[Brian Pedaci]

OK, let's look at it the other way - by your logic, either you supplement everybody's first home purchase or nobody's. Where do you draw the line if not on an income level? Rhetoric about 'encouraging' single-parent families is hooey - it's about helping those who are economically challenged to succeed. A single parent isn't usually a single parent forever. They're just adding some additional qualifications to the basic one, which is "hasn't owned a house in three years".

By the way, a 'displaced homemaker' might, for example, be a woman who has been out of the workforce for some time but either through divorce or death of a spouse finds themselves needing to find a job again without marketable skills. Do you have a better, more concise term for this?

There are strict debt-to-income ratio rules that must be met, to ensure that the buyer isn't overextending themselves with the payment. Also, their credit must be good enough to get the loan in the first place.

Nobody's discouraging more affluent (or just plain middle class) buyers from choosing Lakewood by making it easier for those in the lower class to become an owner rather than a renter. Isn't one of the things you think is 'wrong' with Lakewood too many renters? Why not convert lifelong renters to homeowners? Wouldn't that increase their stake in the neighborhood and encourage them to be better citizens?

I don't see this program as a hand-out in the same manner as welfare, I see it as a method of encouraging long-term investment and building capital. It's not free money - it's a second mortgage.

[Charyn Compeau]

I would also add that one of the major rationales for these programs is that people in lower income brackets can often afford the mortgage and maintenance cost of a home, but are not able to save enough money for the initial down payment and closing costs.

Charyn

[ryan costa]

TV programming has advanced a lot over the years. It is much better today at promoting the development of ADHD kids. On one hand that is ok--they go on to become more suggestible to further advertising ploys and credit card spending as they grow older. On the other, they are pretty loud and aggravating: that lowers property values.

If incentives are offered to single parents, they should be based on that household not having televisions or cable television. Throw in a free set of 1988 Worldbook Encyclopedias and you are set.

[Brian Pedaci]

May I offer you a humble WTF, sir? Seriously, I can make no sense out of that post whatsoever.

[dl meckes]

translation: tv makes you want to buy stuff

[Brian Pedaci]

Which is germane to the conversation how?

[Ryan Salo]

When I was on the CDBG committee a couple of years ago I learned all about the down payment assistance program. At the time this program had around a million dollars, yes a million dollars available to be given. If any of the following information has changed please let me know.

The county keeps giving us around $250,000 a year to use for lower income purposes. We do not actually get the money, we have to spend it and then get reimbursed from the county. I had inquired at the county level about what other uses were available for this money. I learned that we can use it for a lot of different purposes including new multi unit property complexes and for double conversion programs. I guess Cleveland Heights gave a very large chuck of change to a private developer to help him build a very large condo unit; the only stipulation was that a percentage of the units had to be set aside for lower income families.

I am in the mortgage business and can see why the down payment program just doesn’t work. There are a lot of no money down programs that do not require you to get a 2nd lien put on your house and many of the people that would qualify for the money wouldn’t qualify for a loan! That is why the money just keeps growing. I asked during the meetings why we kept taking it and I was told it is a take it or lose it program, and we should just take it even though we have no plans for it...

I really hope that the city finally takes the initiative to make better use of this money.

I hope that it has changed in 2 years, so please update me if it has.

Thanks!

[Brian Pedaci]

Isn't the down payment assistance at lower than market rates? Why would it behoove a homebuyer to finance 100% at a higher rate when they could do 90% at a higher rate and 10% at a lower rate? Plus, if they have the downpayment assistance, could they qualify for FHA loans for the principal, which usually require a minimum of 3% down?

[Ryan Salo]

As far as I know the program(the down payment assistance program) doesn't have an interest rate. The money is given as a 2nd lien that is forgiven over time that doesn't require any payments. If you chose to sell or refinance before it was forgiven you would have to pay it off. The only banks that offered loans in conjunction with this program, at least at the time, didn't take people with "bad" credit. Most FHA lenders, but not all banks, takes lower or higher income folks with no score requirements. FHA allows the seller to give the 3% so in most cases the buyers do not need any out of pocket cash.

What I have seen is that if folks qualify for the "free" money, they probably, in a lot of cases, won't qualify to the banks standards that are included in this program.

I would agree that free money is better than financed money, but the strings attached and the fact that there, at least at the time, were not any "sub-prime", or non score driven lenders available made it difficult to find people that could use the money.

I would hope that the city looks into how other cities are effectively using this money rather than continue to let it build up in the county's bank account.