Florissant Considers 10% ‘Forgivable’ Loans Homebuyer Program
By Carol Arnett
The Florissant City Council held a work session after their regular meeting this week to discuss among other things , a first time home buyer program for the city.
Councilman Tim Lee said that this is something that several council members had expressed support for starting a program, and he wanted to keep the momentum going.
Lee offered some ideas for a program and asked the council for input. He said the program could offer forgivable loans to first time homebuyers in the city of up to 10% of the purchase price, up to $7,000. He stressed that the program would be for first time homebuyers in the city; someone could own a home in another municipality and move to Florissant and qualify.
The loan would be forgiven if the homebuyer stays in the home for a certain period of time. If they sell earlier, they must pay the loan back.
Lee proposed no income qualification; He said he wanted to open the program for all. He noted that most municipalities that offer programs like this have an income qualification.
The purchaser would have to secure financing for the home. City Housing Director Carol O’Mara was not at the meeting but had sent her ideas about the program to the council. She recommended that each participant be required to complete the city’s homebuyer program. She also suggested that the homebuyer has to provide some of the down payment, and she suggested five years as the time in which the loan is forgiven. She suggested that residents currently renting could apply also for the program.
There was some discussion about when the five years would start, either at closing or at occupancy. Councilman Joe Eagan pointed out that not all vacant homes are ready for immediate occupancy. “Some homes are in bad shape. Can we give them time to get them up to code?” He suggested that the five years start from date of occupancy.
Other council members questioned if participants could get a mortgage without passing an inspection. Councilman Mark Schmidt suggested that the council ask someone from the mortgage industry for their input. Mayor Tom Schneider said that he would speak to some people about giving their input to the council.
City Attorney John Hessel said the program should have no problem from a legal standpoint. He suggested that if the goal of the program was to attract new homeowners, the money should be available at closing.
The council agreed to study Lee and O’Mara’s ideas, meet with the mortgage industry professionals, and continue to work on the program.
You must be logged in to post a comment.