CHICAGO - Like many first-time homebuyers, Lee Wells had looked for a home he could afford in Chicago’s North Lawndale community, but everything was either too expensive or needed costly renovations that he could not afford. Thanks to a pilot program today announced by Governor Rod R. Blagojevich, Lee Wells is a new homeowner in North Lawndale. Through HOME ADVANTAGE, more than 35 aspiring first-time homebuyers in Chicago’s South and West Side communities will be able to use a new below-market interest rate program to buy and rehabilitate their first homes.
“I am proud to help make the dream of homeownership a reality for working families,” said Gov. Blagojevich. “HOME ADVANTAGE will provide moderate income homebuyers the financing they need to purchase and renovate their first homes. This public/private partnership will help preserve affordable housing and will help spur redevelopment on Chicago’s south and west sides.”
The new HOME ADVANTAGE mortgage rehab program, financed by the Illinois Housing Development Authority (IHDA) and administered by ShoreBank, was created in partnership with Congressman Danny K. Davis, SANKOFA, a non-profit community group based on Chicago’s West Side, and the Community Ventures Investment Corp. (CVIC) development company. HOME ADVANTAGE is the first and only available IHDA program that rolls the purchase and renovation costs into one loan.
The HOME ADVANTAGE mortgage is a pilot program designed to preserve existing affordable housing. Preservation of existing affordable housing is a key component of Gov. Blagojevich’s vision for affordable housing in Illinois and is an essential part of Illinois’ first comprehensive housing plan Building For Success. This working plan outlines Gov. Blagojevich’s housing goals and includes specific strategies to effectively use state resources to best meet the affordable housing needs of Illinois residents.
The HOME ADVANTAGE mortgage offers a 30-year fixed mortgage with an interest rate that is a half to a full percent below the market rate. The HOME ADVANTAGE mortgage will be insured and underwritten by AIG United Guaranty, a private mortgage insurance company.
“The HOME ADVANTAGE mortgage is an excellent example of how IHDA works to meet the specific housing needs of individual communities. This pilot program will provide greater access to affordable home ownership opportunities for Chicago’s working families, revitalize existing affordable housing stock and encourage neighborhood economic growth,” said Kelly King Dibble, Executive Director of IHDA. “We are proud to work with community leaders and elected officials to design a program that meets the needs of their community,” added Dibble.
“In Washington, we work to create new opportunities. The HOME ADVANTAGE program does just that,” said Congressman Danny K. Davis (D-7). “Through this program, families will have a chance to become homeowners, neighborhoods will get a new face with rehabbed homes, employment prospects will increase for workers in the housing industry.”
Through the new HOME ADVANTAGE mortgage rehab program, eligible first-time homebuyers may also receive down payment and closing costs grants of up to 4.25% of the purchase price of the home. ShoreBank will provide eligible participants with homebuyer education courses on topics that will include how to choose a realtor, how to hire a contractor, and how to choose energy-efficient products and practices to reduce energy usage that can lower monthly utility bills by 25 to 50 percent a month.
“This exciting new community HOME ADVANTAGE collaborative was founded by SANKOFA and CVIC with the goal of increasing affordable housing opportunities for low- and moderate-income homebuyers, using the avenue of housing preservation and revitalization,” said Anthony Oliver, President, Community Venture Investment Company, a real estate investment company specializing in real estate acquisitions, development and management within low and moderate Income communities.
“This program helped me afford to own home and fix it up. Now my family has an appreciable asset that helps ensure the well being of my family and the community,” said Lee Wells, the first participant in the HOME ADVANTAGE mortgage rehab program.
About the Illinois Housing Development Authority
The Illinois Housing Development Authority (IHDA) is a self-supporting, state chartered corporation that finances the creation and the preservation of affordable housing across Illinois. Since its creation by an act of the Illinois legislature in 1967, IHDA has allocated more than $6.4 billion and financed more than 150,000 units of affordable housing across the state. IHDA accomplishes its mission through a number of federal and state funding sources, including the Illinois Affordable Housing Trust Fund, the State’s Donations Tax Credit Fund, the allocation of federal Low Income Housing Tax Credits, HOME Investment Partnership funds and others. IHDA is also a bonding authority, and independently sells bonds based on its won good credit to finance affordable housing across the state.
ShoreBank is America’s first and leading community development and environmental bank. It is committed to providing individuals, small businesses, nonprofit and faith-based organizations from underserved neighborhoods with access to the financial resources and information that help create vibrant communities and a healthier environment. Headquartered in Chicago, ShoreBank has affiliated nonprofits in Chicago; Cleveland; Detroit; Ilwaco, WA; and Portland OR; business development services in Michigan’s Upper Peninsula and consulting services around the world. Since its inception in 1973, ShoreBank has provided more than $2 billion for the purchase and renovation of more than 45,000 affordable housing residences and the development of more than 10,000 jobs in Chicago’s South and West Side communities. For more information, visit, www.shorebankcorp.com
About AIG United Guaranty
United Guaranty Corporation (AIG United Guaranty) and its subsidiaries are member companies of American International Group, Inc. (AIG). The company has been headquartered in Greensboro, North Carolina, since it was established in 1963. Subsidiaries of AIG United Guaranty provide mortgage guaranty insurance for first and second mortgages that protects against mortgage credit losses. In addition, AIG United Guaranty’s comprehensive range of financial products and services to lenders and investors includes mortgage fraud recovery services, student loan default insurance, and access to insurance products from AIG member companies. American International Group, Inc. (AIG) is the world’s leading international insurance and financial services organization, with operations in more than 130 countries and jurisdictions.
Sankofa, a community based not for profit organization, was concepted in 1975 to teach and implement cultural awareness and appreciation, economic development, housing, education in the areas of management, home ownership through sweat equity and other strategies for tenant rights. Sankofa has taken the responsibility to serve the communities where researching information and access was not available to the under privileged and low-income areas and has established a strong reputation for being on the cutting edge of community development issues that effect low-income residents. Sankofa understands that by education, opportunities, and access, our community will grow into self-development and awareness thereby prompting action individually and collectively.
About CVICCommunity Venture Investment Corporation (CVIC) is a for-profit LLP that specializes in the acquisition, development, and management of single and multi-family housing in low- to moderate-income communities in Chicago. Founded in August 2003, CVIC seeks to create a valuable investment experience while increasing human potential and building better communities. CVIC was launched to address the need for affordable housing assist low-and moderate-income individuals who seek greater levels of self-sufficiency through home ownership.