This just in… Two Innovative INHP programs create new affordable homeownership opportunities

Taryn Kincaid and her INHP mortgage loan originator Stephanie Adams celebrate Taryn’s closing day.

 

The Indianapolis Neighborhood Housing Partnership has launched two programs to assist those with low-to-moderate income – and combat against the market factors that may be holding back some people from purchasing or rehabbing a home in the city’s urban neighborhoods.

INHP officials pointed out that it’s no secret that the residential housing market is strong in Marion County, including the urban neighborhoods. Home values are on the rise and listed homes are receiving offers at breakneck speed.

However, the bull market comes at a cost to prospective homebuyers with low-to-moderate incomes. A recent report from the MIBOR Realtor Association states, “Rising home prices, higher interest rates and increased building material costs have pressured housing affordability to a ten-year low.”

The report also notes that increases in household income aren’t keeping pace with the increased costs of housing. These trends are causing the American Dream to appear out of reach for many, and for some, the benefits of building equity through homeownership may seem elusive.

That’s where the two INHP programs come in.

INHP’s Home Value Guaranty (HVG) program is essentially what it sounds like: INHP will guarantee an appreciated home value increase of 5 percent from the cost to purchase and repair the home. The guaranty applies to the first seven years of homeownership, and the buyer must purchase a home as his or her primary residence in one of five designated neighborhoods. If the home’s value does not increase 5 percent above the cost to purchase and repair the home, INHP will reduce the mortgage balance accordingly.

The participating neighborhoods include St. Clair Place and Englewood on the Near Eastside, Mapleton-Fall Creek and Crown Hill in Midtown; and Riverside in the Northwest area. Each of these neighborhoods is experiencing revitalization.

The second program, Rehab Match, is also eligible for homes in the same five neighborhoods plus any property available through Renew Indianapolis, the city’s land bank. The homeowner must purchase a vacant or abandoned home and personally complete some of the repairs. The value of their “sweat equity” may be matched up to $15,000.

“We anticipate these two innovative programs will create excitement and opportunity for prospective homeowners with modest incomes, helping them purchase homes in neighborhoods experiencing revitalization,” said Rob Evans, chief operating officer and executive vice president of homeownership initiatives at INHP. “Homeownership provides a path to improving one’s quality of life, and these programs align with INHP’s belief that everyone deserves to live in a safe, decent, affordable home in a vibrant neighborhood.”

Not only do these programs offer incentives, but they also offer favorable loan terms that help homeowners build equity at an accelerated rate. For instance, a homeowner can choose a 20-year mortgage with monthly payments that are nearly identical to a 30-year mortgage, which significantly lowers the interest paid over the life of the mortgage.

Individuals or families interested in these programs can get started by filling out an interest form at INHP.org. To be eligible, the applicant’s income must not exceed 120 percent of HUD’s Median Area Income. For an individual, this is almost $65,000, and for a family of four, it’s a bit over $92,000.

Participants in the Rehab Match program also must demonstrate their ability to skillfully complete the repairs. Once qualified, INHP connects the homebuyer to resources, including community partners who can help find a property, identify vetted contractors and oversee home repairs.

Taryn Kincaid, a youth employment director at a non-profit bike shop, was pursuing a conventional route to purchasing a home, but several people suggested that she increase her budget or adjust her expectations. Everything changed when she met with Stephanie Adams, a mortgage loan originator from INHP.

“She made my goals her goals and made home buying in my preferred budget and neighborhood accessible for me,” said Kincaid.

Adams told Kincaid about a new home that would be move-in ready and within her budget in the Riverside neighborhood, which would qualify for the Home Value Guaranty program.

“The interest rate was, by far, the most competitive, and I was able to choose a shorter loan term that was still affordable for me,” said Kincaid. “The guaranty also helps relieve some of the risk.”

Since she moved in at the end of September, Kincaid has fallen in love with her neighborhood. Neighbors have welcomed her with warmth and graciousness, and she enjoys the greenways, esplanades and nearby waterways.

“I feel like I bought a home and got a neighborhood,” she said.

With help from INHP, Colte Tomlinson was able to purchase an abandoned property on the Near Eastside for less than $5,000 and access a loan through the Rehab Match program. Tomlinson applied his technical skills to install insulation, flooring, tile and cabinets. INHP matched the value of his labor dollar for dollar.

Colte said he has witnessed a great deal of growth in the neighborhood in the year and a half since he purchased the house, pointing out several homes on his street that have undergone changes and improvements.

“The value has gone up in the neighborhood,” Tomlinson said, adding that he has received six offers to purchase his house as-is. “INHP wanted me to invest in my own property. I get to do quite a bit of work. It’s exciting.”

Learn more about these programs at INHP.org/hvg and INHP.org/rehab-match.

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