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Program Offers Down Payment Assistance to Boost Housing Market

As the nation works to recover from a struggling real estate market, an innovative program called CityLIFT has been unveiled in an effort to boost homeownership. The program will benefit those people with good credit who qualify for a loan, but need that extra lift with a down payment. Through the new program, Wells Fargo Bank is offering qualified homebuyers down payment assistance as part of a partnership with the independent nonprofit NeighborWorks America. The long-term goal: to create sustainable homeownership and help cities hit hard by the housing crisis. A strong, stabilized housing market, they anticipate, will ultimately aid in America’s economic recovery.

The Philadelphia CityLIFT program, which officially begins in September 2012, will include a $10 million investment for down payment assistance grants in an effort to help people achieve their dream of homeownership. This program includes a five-year goal of making $2.2 billion in new mortgage loans for qualified homebuyers in Philadelphia. Philadelphia is one of 20 cities chosen by Wells Fargo to reap the rewards from $170 million dollars in assistance.

To qualify for Philadelphia CityLIFT assistance in obtaining a down payment, candidates are required to meet special criteria. Annual income, for example, cannot exceed 120 percent of the median income for the area. This maximum will vary based on the size of the family. Each potential homebuyer also must attend a homebuyer education session with a Housing and Urban Development (HUD)-approved counselor, such as NeighborWorks America affiliates. In addition, the homeowner has to qualify for a first mortgage on the property and agree to stay in the home for at least five years. Participants may obtain the mortgage financing, however, from any approved lender.

CityLIFT and NeighborhoodLIFT

The CityLIFT program is much like Wells Fargo’s NeighborhoodLIFT program which has met success all over the country in cities experiencing tough markets such as: Phoenix, Atlanta, Houston, Las Vegas, Los Angeles, Miami, Minneapolis/St. Paul, Orlando, Jacksonville and Tampa.

NeighborhoodLIFT events have been held in multiple communities across the country giving qualified people access to homebuyer education sessions, down payment assistance, home and renovation financing and tours of residential properties available for sale.

The program, which still has money available in several cities, plans to continue to reach out to neighborhoods across the country hardest hit by the economy and the foreclosure crisis. The program set aside a total of $30 million in down payment assistance this year, for example, in Florida where the drop in housing values seriously stressed the market.

Over the course of five years, they intend to meet the goal of $300 million in mortgage loans by Wells Fargo and provide $9 million in down payment assistant grants and homebuyer support systems. In Los Angeles, the program will provide $15 million, and in Atlanta, $8 million will go toward down payment assistance, renovation financing and other homebuyer programs this year.

Everyone Benefits

The collaboration among Wells Fargo Bank, the Wells Fargo Foundation, NeighborWorks America as well as other local nonprofits has helped more than 260 new homeowners invest in their future. At least another 240 people, according to Wells Fargo, are in the process of closing on homes. Moving the housing inventory benefits everyone.

People interested in the program can visit LIFT events to determine whether they qualify for financial assistance and may be able to reserve up to $15,000 in funds for 60 days while they shop for a new home. The program includes an Affordable HomeTour viewing center to preview featured homes available in the location. Some programs offer free bus tours of local homes.

In addition to the CityLIFT event in Philadelphia in September, a NeighborhoodLIFT event will be held in Minneapolis/St. Paul, Minn. Registration is recommended to guarantee a personalized meeting with a professional.

Bill “No Pay” Fay has lived a meager financial existence his entire life. He started writing/bragging about it in 2012, helping birth Debt.org into existence as the site’s original “Frugal Man.” Prior to that, he spent more than 30 years covering the high finance world of college and professional sports for major publications, including the Associated Press, New York Times and Sports Illustrated. His interest in sports has waned some, but he is as passionate as ever about not reaching for his wallet. Bill can be reached at [email protected].

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    Sources:

    1. Brannigan, M. (2012, May 11). Homebuyer plan provides downpayment help in Miami. The Miami Herald.
    2. NeighborhoodLIFT Pilot Creates Ownership Opportunity and Stabilizes Neighborhoods. NeighborWorks. Retrieved August 28, 2012, from http://www.nw.org/network/neighborworksprogs/ownership/LIFT.asp
    3. Prior, J. (2012, January 25). Wells Fargo launches pilot programs to clear LA, Atlanta housing inventory. HousingWire.com. Retrieved from http://www.housingwire.com/news/wells-fargo-launches-pilot-programs-clear-la-atlanta-housing-inventory
    4. Wells Fargo. (2012, August 23). Wells Fargo brings CityLIFT program to Philadelphia to help local housing market [Press release]. Retrieved from https://www.wellsfargo.com/press/2012/20120823_CityLiftPhiladelphia