Thanks to a bill just passed by large majorities in both houses and signed by the governor, the Vermont Housing Finance Agency (VHFA) will soon be able to offer qualified first-time homebuyers a leg up in the form of a $5,000 “sleeping” loan.
The $5,000 assistance be in the form of a zero interest loan, with no payments. The loan is repaid when the homeowner sells their home or refinances.
In email correspondence with Brattleboro Buyer Brokerage, Seth Leonard, VHFA Homeownership Outreach Coordinator, wrote:
“The passage of the legislation and subsequent bill signing has enabled to initiate the program funding and design stages. It will likely be August before VHFA will be ready to present the program structure, qualification considerations, and funding details. We have to finish designing the program and preparing it for launch. At that time we will first train our Participating Lenders on the program so they are prepared to offer the program, prior to a larger public push to increase awareness.”
The downpayment assistance is part of S.138 – An act relating to promoting economic development. The text of S.138 explains how first time homebuyer downpayment assistance will have a positive impact on economic develop:
VHFA; Down Payment Assistance Program * * * Sec. G.6. DOWN PAYMENT ASSISTANCE PROGRAM; FINDINGS The General Assembly finds:
- The Federal Bipartisan Policy Center’s Housing Commission notes that homeownership can produce powerful economic, social, and civic benefits that serve the individual homeowner, the larger community, and the nation.
- Supporting more Vermonters to become homeowners allows them an opportunity to improve and invest in their neighborhoods and become stable members of their community’s life and workforce.
- Homeownership, even with the recent decline in housing values, has continued to be the most reliable source of individual wealth accumulation and equity for the future.
- First-time homebuyers often delay purchasing a home due to the fees and down payment costs required at closing and need support to achieve their homeownership opportunity.
Steven K-Brooks, Prncipal Broker
Brattleboro Buyer Brokerage Real Estate
www.buyer-brokerage.com
Good start
This is a good start and much needed. It would be great if it were more than $5,000, though.
My grandparents houses were built for $3-5k.
When I was a kid, an OK, basic house was in the $10-20k range. By the end of high school, that number had gone up to about $40-60k.
When I got myself a bit more established, houses were in the $80-120k range but rising. When we moved to Brattleboro, $120-180k would get you something pretty good.
Now it seems like $200-250k is about the minimum for a house, and one would likely expect to put another $20-40k into it to appease the insurance and code gods.
To come up with a 20% deposit, one would need to set aside $40,000 cash. Very difficult bar to reach nowadays.
Yes, a good start
The downpayment issue is a problem for aspiring owners. Who can put away that substantial amount- especially if single and working at low-wage jobs? Since living in Bratt I’ve paid nearly $58,000 to landlords in rent alone, many times with no heat or utilities included. Yes, I calculated it. $58K to pay off other people’s mortgages, not my own.
Correction
Somehow, I omitted years on Oak St from that calculation. Amend that total to $110,230 I’ve paid in rent here in Bratt.
Progressive Cart before the Horse Program.
Yup, just another Vermont austerity program created without a clue as to how it will work or be paid for since we don’t have all the details yet but we know it will be $5,000 of “someone’s” money.
So let me get this straight. We give $5,000 to a first time home buyer. We help them buy a home in the Brattleboro area. Assuming they currently have an adequate income to go through the lending process. And what happens when they leave the area because their current employer packs up and leaves this regulatory nightmare? Oh that’s right, it gets paid back by the sale of the home. If the home sells with all the other houses on the market.
And this is a great economic development program? Yeah maybe for realtors. Doesn’t really help create any real jobs though.
How about some real relief. Here’s a revelation. How about just reducing or waiving the “fees/taxes” and down payment costs? Oh no!!! Heaven forbid we do that!! Then the banks and regulators wouldn’t be able to scoff up the proceeds of a home sale.
Just a tidbit of info. People need homes in the area when they have a good job.