Cohousing-L Mailing List: Re: Two Affordable Condos in CoHo Ecovillage, Oregon

[Fred H Olson (fholson]

After I posted the Two Affordable Condos in CoHo Ecovillage, Oregon
announcement for Dee since she is not subscribed I realized people would
ask how the loan packages were arranged.  The excerpt below is from their
web site ( http://cohoecovillage.org/financing/index.shtml )  The second
option, the "Shared Appreciation Mortgage", sounds effectively much like a
housing trust / land trust mechanism. The way it is conceived however may
make it easier to understand.  It sounds more like a mutually beneficial
contract than a whole new way to deal with the housing market.
There is also a Wikipedia aricle on the topic:
http://en.wikipedia.org/wiki/Shared_appreciation_mortgage

Fred


Through Willamette Neighborhood Housing Services (WNHS), developer of the
CoHo project, several loan packages for up to $80,000 in financial
assistance might enable you to buy that home you're dreaming about and be
part of our CoHo community.

There are two primary financial packages:

* The first special loan program allows previous home ownership and
some flexibility in current savings, and gifts/financial help from friends
and family.

* The second, potentially larger package requires that you have not
owned a home in the last three years or don't own the land below your home
(often the case with mobile homes). This larger package relies on the use
of a "Shared Appreciation Mortgage" (SAM), which is a 0% interest second
mortgage with no payments until the loan is due. The loan is "due" when
you sell or transfer the property, default on the terms of the loan, or
refinance the property. At that time, WNHS will receive a share of the
appreciated value. The portion of the appreciation retained by the seller,
and that which is due WNHS, is determined by a formula specified in the
loan agreement.

Income Qualification Chart

The following chart lists the median incomes that the buyer must be at or
below to qualify for this loan:

Household Size  80% of Median
1       $38,150
2       $43,600
3       $49,050
4       $54,500
5       $58,850

--
Fred H. Olson  Minneapolis,MN 55411  USA        (near north Mpls)
Communications for Justice -- Free, superior listserv's w/o ads:
http://justcomm.org      My Link Pg: http://fholson.cohousing.org
612-588-9532 (7am-10pm CST/CDT)   Email: fholson at cohousing.org