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Community Loan Fund aids home purchases
YOUNGSTOWN
Have a stable income but don’t qualify for a traditional home loan?
Maybe the Youngstown Neighborhood Development Corp., through its new Community Loan Fund, can make the dream of home-ownership come true with a low-interest loan.
Youngstown Neighborhood Development Corp. has received a $500,000 grant from the Ohio Housing Finance Agency’s Housing Investment Fund to help establish the YNDC loan fund.
YNDC is an organization focused on stabilizing and revitalizing city neighborhoods.
The project is a public/private partnership that includes the Ohio Housing Finance Agency, city of Youngstown, Raymond John Wean Foundation, Home Savings and Loan Company, local U.S. Department of Housing and Urban Development-certified counseling agencies, banks, major employers and other partners.
To date, YNDC has secured more than $1.3 million in commitments for the fund and expects to formally launch the program within the next 30 days, said Presley L. Gillespie, YNDC executive director.
The YNDC Loan Fund has commitments from foundations, $315,000 from the Youngstown Home Program, $125,000 from the Wean Foundation and several pending commitments, Gillespie said.
He said the agency will announce within a few weeks when loans are available.
The Community Loan Fund, in development for over a year, will provide alternative access to credit and bolster revitalization and economic recovery in vulnerable and transitional neighborhoods.
The program, limited to Youngstown, will identify candidates in every part of the city where there are rising levels of housing abandonment but that are deemed, by virtue of market activity of houses being bought and sold, to offer an opportunity for restoration, Gillespie said.
Examples of such neighborhoods are Idora, Brownlee Woods, Crandall Park North and Lincoln Knolls, he said.
The loan fund will support financing for the purchase of owner-occupied housing in eligible neighborhoods by providing first-mortgage financing.
In addition to having been denied a conventional bank loan, eligible applicants must be able to afford the payments, which include a n ownership reserve account for emergency repairs. Also, their applications will be reviewed by a committee made up of investors in the program and community residents, Gillespie said.
After purchasing the home, the loan recipients will receive intense financial training for three years while in the YNDC program and must live in the home for the duration of the loan.
Gillespie said the loans will be a maximum of $75,000 for up to 25 years and will be paid back to YNDC. “The money would ideally be recirculated,” he said.
"We believe it will help jump-start our neighborhood real-estate markets across the city of Youngstown, while complementing and extending the reach of conventional lenders over time,” Gillespie added.