New Castle County aims to revitalize neighborhoods with mortgage loans
New Castle County is funding a new no-interest loan program to help homebuyers make down payments on properties in distressed neighborhoods.
The county will be able to offer 50 to 100 of the $5,000 loans at a time. They're meant to be used in 20 census tracts from Glasgow to Newark with high levels of foreclosure, vacancy and declining home values.
"When you have less foreclosures, less vacancies, your neighborhood tends to be more stable," says county community development and housing manager Carrie Casey. "So this program is going to incentivize people to buy and try to stem that tide of distress."
Casey says these loans will work in tandem with federally-funded programs the county already offers to help with mortgages and home repairs. And she says the county funding makes this program more flexible.
"We're trying to incentivize making it a larger pool of prospective buyers to actually buy in these census tracts," she says.
Recipients of the county loans don't have to be first time homebuyers, and their household incomes can be as much as 120 percent of the area's median -- meaning about $97,000 for a family of four.
Plus, the loans have zero interest, as opposed to 3 percent on the county's current federal loan program. And "the maximum sales price is $379,500, which is a big, big plus," says homebuyer program administration Norman Spector. "And it can be new construction, existing [homes] -- does not have to be a vacant property."
The county loans are designed to be paid back over 10 years and used on anything from vacant properties to new construction.