Business

Thursday, Aug. 14, 2008

Biz Buzz: City and fed funds help low-income home buyers

First-time home buyers will now have financial help from a program matching federal funding

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The city of San Luis Obispo now has a program to help low-and very-low-income residents buy homes, a program financed 50-50 by federal and city money.

“There are three loans in escrow right now,” said Kim Murry, the city’s deputy director for long-range planning. “These are generally fairly small loans—to fill a gap for closing costs, deposits and other things — in the $15,000 to $40,000 range.”

Two of the residences are in Parkwood Village on Southwood Drive, a complex that converted 168 apartments to condominiums in 2005.

The limited number of price-restricted units at the complex are selling for $90,000 to $138,000, Murry said. “A $10,000 loan is huge for that,” Murry said.

The city’s First Time Homebuyer Program received $231,000 in federal funds through the Federal Home Investment Partnership Act. In July 2007, the City Council authorized matching the funds from its own affordable housing fund.

Murry said the loans can make all the difference to individuals.

“It’s a very narrow margin of folks who qualify under the income limitations, can still qualify for the loans and make mortgage payments,” she said.

The city loans accumulate simple (not compounded) interest at the rate of 3 percent per year for 20 years, and at the end of that period, the homeowner has to start paying the principal and interest back into the fund. The presumption is that other mortgages on the property would constitute a lighter financial load at that time.

If the home sells before the 20 years end, then the homebuyer must pay back the principal and whatever interest has accumulated.

Income limits for participation are $23,450 in annual salary for a single person to qualify as very-low-income. For a two-person household, the limits are $26,800 annually for a very-low-income household and $42,900 for low-income.

—Sally Connell

Heritage Oaks names new IT supervisor

Heritage Oaks Bank recently promoted Darren Mc-Clellan to information technology supervisor. He will oversee technology operations at the bank. McClellan has worked for the local financial institution as a tech support representative for the last three years.

—Tonya Strickland

Insurance agent offers AARPendorsed policies

Steve Hughes, a local long-term care insurance agent, is now authorized to offer AARP-endorsed insurance policies in California by Genworth Life Insurance Co. He’s worked in the industry in San Luis Obispo County for more than 15 years.

—Tonya Strickland

Village at Sydney Creek celebrates seven years

The Village at Sydney Creek, a senior community at 1234 Laurel Lane in San Luis Obispo, on Wednesday celebrated its seventh anniversary. Proceeds from a silent auction will go to the Central Coast Alzheimer’s Association.

—Tonya Strickland