The Stillwater City Council has given city staff its blessing to begin developing a homebuyer assistance program. It’s a reimagining of a program that was discontinued in 2012.
The discussion about reviving the program grew out of a request last March from Habitat for Humanity for fee waivers to make building its homes more affordable. Although that wasn’t approved, it sparked a discussion about housing affordability and ways the City could help.
A group composed of city staff, Habitat for Humanity staff, people involved in real estate sales and mortgage lenders began meeting to talk about what would be needed.
The City’s previous homebuyer assistance program awarded up to $5,000 in downpayment assistance to first-time homebuyers who qualified as low to moderate income.
The money was recorded as a second mortgage that was fully forgiven if the buyers stayed in their homes for at least five years. In other cases, it was prorated at 20% per year of occupancy.
Assistant City Manager Paula Dennison said in some cases, that second mortgage was a problem because it can disqualify buyers from certain financing options.
She outlined a new plan that would serve a wider section of the community than the old program and has broader income requirements that combine standards used by Habitat for Humanity with the Oklahoma Housing Finance Agency’s gold standard for conventional financing.
Homebuyers would have a minimum income requirement of $12,000 and a maximum of $73,000.
There would be multiple possible tracks for assistance, Dennison said.
People of low to moderate incomes who are buying a home for the first time ever
People with no income limit who are buying for the first time in Stillwater, although they would have a price ceiling.
Rehabilitation, remodeling or reinvestment of owner-occupied properties.
Dennison said at one time the City had a similar program for rental properties and she would like to look into offering that again. She said many young people seem to prefer renting rather than buying and rental property owners can still be good owners.
Homebuyer education would still be a part of the program, but the class would likely be condensed from eight hours into a 3-4 hour class.
The City has about $37,000 to spend on the program for this fiscal year. The funding comes from leftover money that was recovered by the City from the previous program.
The Councilors didn’t have to take any action aside from encouraging Dennison to keep working on the details of a final plan.
That plan will be presented to the Councilors when it’s complete for their approval.
Mayor Will Joyce said he would also like to revisit the fee waivers requested by Habitat for Humanity. He asked to see a breakdown of the City’s fees.
Joyce said he wants the City to do whatever it can to help organizations like Habitat for Humanity build more homes.