Vermont Homeownership Programs and Financing

AGENDA Programs Vermont Community Land Trusts Vermont HomeOwnership Centers FinancingVHFA USDA Rural Development VHCB HOMELAND VSHA Homeownership Voucher Program

Vermont Community Land Trusts Developers Owners of Affordable Rental Housing NeighborWorks HomeOwnership Centers

Vermont HomeOwnership Centers Homebuyer’s Workshops Counseling –Pre-purchase –Delinquency and Foreclosure Resource and Referral to loan programs and products and housing professionals Referral to loan programs and products and housing professionals Access to Grants Revolving Loan Funds – –Health and Safety –Well and Septic –Energy Conservation

VHFA Offers low interest loans for eligible borrowers through participating banks, savings and loans, and credit unions. Products –MOVE –Cash Assistance –HOUSE –Limited Refinance

USDA Rural Development Direct loan program (502) –Subsidized loans to eligible borrowers –Below 80% median income –Regional offices originate loans Guaranteed Loan Program –Offered through local lenders –Eliminates need for down payment or mortgage insurance Repair Loan Program (504)

Community Land Trust Model HOMELAND grants provide both initial and perpetual affordability. One-time investment by the State. Homeowners share appreciation when they sell

HOMELAND Shared Appreciation Program What Happens When I Sell My Homeland House At Purchase Original Appraised Value$175,000 Original Purchase Price$175,000 CLT Grant--$ 35,000 Original Net Purchase Price$140,000

At Resale New Appraised Value $225,000 Original Appraised Value- $175,000 Market Appreciation $ 50,000 Appreciation that Owner Earns $50,000 x 25% = $12,500

Option Price Original Net Purchase Price $140,000 Owner’s Share of Appreciation+ $ 12,500 Price Owner sells house to CLT $152,500 What Owner Makes on Sale $152,500 Option Price - $135,000 Pay off of Mortgage $ 17,500 = $12,500 appreciation + $5,000 mortgage principal

Price to New Buyer CLT purchase price $152,500 CLT Stewardship Fee (6% of new appraised value)+ $ 13,500 Price to New Buyer $166,000 Amount ‘Banked’ in Perpetual Trust Original Grant $35,000 Shared Appreciation+ $24,000 TOTAL $59,000 $225,000 - $166,000 = $59,000

VSHA Homeownership Voucher Program Comparable to Section 8 Rental Voucher Subsidizes PITI and maintenance costs of owning a home Available to existing rental voucher holders. Waiting list to join is closed for people without rental vouchers.