Re: Town of Truckee establishes a local First-time Homebuyer’s Down-Payment Assistance Program!

Abstract: The Town of Truckee, in partnership with its Redevelopment Agency, has established a first-time homebuyer’s down-payment assistance program (a.k.a. “silent second”) to increase for-purchase housing opportunities. The program is geared towards working folks in three income classifications that are prevalent locally: “low-income”, “moderate-income”, and “above-moderate income”. Program participants are required to either live or work within the Town’s boundaries. This down-payment assistance program targets the existing housing stock, with most all forms of residential dwellings eligible to participate (i.e., single-family detached homes, duplexes, tri-and-four plex units, condominiums, and even manufactured homes – so long as the unit has a permanent foundation). There are very few “strings” attached to participation in this program, which is why many anticipate that this housing affordability expansion effort will actually be embraced by the community, receiving great attention and extensive use. The primary conditions for inclusion involve meeting the income parameters, having not owned real property within the previous 36 months, the geographic connection to the Town through current residence or job, and that the unit to be purchased is utilized as participant’s primary residence for the duration of the conditions of the loan. 

                                                                  

 

                                             

The loan terms involve a 30-year deferred payment structure, with 2% to 3% interest, which is recorded against the real property at the same time, but in second position, when the first loan/primary mortgage is recorded. The program makes use of existing housing inventory, which should serve to enhance our industry’s sales activity. Perhaps of greatest importance to a functional framework, this program is free-market based. Units are purchased at market-rate pricing, and can then be resold to whoever is interested in the property, again without any ornorus restrictions upon the asking or selling price. The Town is to be made whole (i.e., the loan repaid), but the property itself is never saddled with the “affordable-only” or “low-income restricted” housing label. The deed restrictions essentially attach to and run with the loan-holder, not the property’s title. This is a major step forward towards an effective and fully functional home ownership program. 

The timeline for program implementation is as follows: 18 Dec. 2009 is the date slated to officially launch the program; January 2010 multiple workshops will be held to inform the public of this down payment assistance opportunity, and an industry professional’s workshop is also planned specifically for and geared to the real estate industry; 05 Feb. 2010 is the closing date for the Town to receive the first round of applications; with the remainder of February being dedicated to participant selection and initial contact. The Town’s website will be posting information, announcements, and forms as they become available.