New source of affordable housing
August 7, 2008 | By Jim Newton | News Sun
A new federal housing law signed by President Bush last week may increase affordable housing opportunities in Lake County.
The law, aimed at stabilizing ongoing problems in the housing market, includes almost $4 billion in block grants that will allow states and local governments to purchase foreclosed homes and sell at least 25 percent of those homes to lower-income families and individuals.
Lake County, Waukegan and North Chicago are expected to receive an unspecified amount of that new funding through the state.
Lobbying consultant Trent Lehman told members of the County Board’s Revenue Records and Legislative Committee Wednesday that the law “offers a lot of opportunity for the county.”
Although there have been some reports that Illinois would receive about $135 million under the new legislation, Lehman said such details haven’t been finalized.
Officials said the funding would come through the state, and that the county, as well Waukegan and North Chicago, would receive a portion.
“We are entitled to funding in the formula,” said county administrator Barry Burton.
Under the block grant section of the law, all governmental recipients of the new funding must use the money for the purchase and rehabilitation of foreclosed homes and other residential property within 18 months of receiving it.
At least 25 percent of the funds must be used to purchase properties that would house individuals or families whose income is below 50 percent of the area’s median income.
The sale price must be equal or less than the cost to purchase and rehabilitate the homes.
County officials said the funding may be funneled through the Lake County Affordable Housing Corporation, which already oversees affordable housing, low-interest loans and other housing assistance programs.
The law also attempts to temper the housing crisis by providing the Treasury Department with the emergency authority to purchase stock in Fannie Mae and Freddie Mac if it would “provide stability to the financial markets, prevent disruptions in the availability of mortgage finances and protect taxpayers,” according to an overview provided by Lehman.
It also provides billions in new loan guarantees to establish a voluntary HOPE for Homeowners program to help at-risk borrowers refinance mortgages to increase their viability and affordability.
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REO inventory increased in July
In my market area, active REO listings increased 4.7% over June
Pending listings (under contract, no contingencies) decreased 9.4%
Closed listings decreased 2.0%
Previous month trends hinted at a foreclosure slowdown; but that hope was shortlived.
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