Thursday Feb 04 2010
New Placer County Recovery Act program offers hope for homebuyers
By: Gus Thomson Journal Staff Writer
Market for bank-owned properties may feel boost
North Auburn, Bowman and Foresthill are among the areas Placer County is targeting in a new program to reduce the number of vacant, bank-owned houses and help low- or moderate-income buyers purchase residences. The initiative is part of a federally funded nationwide effort known as the Neighborhood Stabilization Program. The county has been awarded a $750,000 grant for its program from Housing and Economic Recovery Act coffers. Other areas in which the county is set to launch the program are Kings Beach, Tahoe Vista and Sheridan. The primary goal of the program is to stabilize neighborhoods hard hit by foreclosures by acquiring vacant, bank-owned houses, renovating them if necessary, and helping residents with limited incomes purchase the homes. Loans also can be made directly to homebuyers to purchase houses already listed for sale directly from banks. In Placer County, the home-purchase assistance will be available to residents with low or moderate incomes. To meet moderate-income limits, a four-person household must have an annual income of no more than $87,350. Each participating household will be required to make a 3 percent down payment and line up financing from a private lender for part of the home-purchase price. The program will provide gap loans up to $150,000 to cover the rest of the purchase price. The loans will be shared-equity, second deeds of trust that do not require monthly payments and generally will not be repaid until homes are sold. A release from the county states participants do not have to be first-time buyers. To be eligible for acquisition, bank-owned homes must have been vacant at least 90 days. The federal government designated which areas are eligible to participate in the program, using data on such factors as foreclosure rates and the numbers of sub-prime mortgages in each area. More information is available at 530-745-3150.