Last year, the Phoenix and Maricopa County industrial development authorities came together to launch the “Home in 5 Advantage” mortgage origination program to assist home buyers with overcoming one of the most common barriers to home ownership by offering down payment assistance.
We obtained input from the lending community and area Realtors who shared their experiences working with potential home buyers struggling to purchase homes in Phoenix and Maricopa County. The non-repayable 5 percent down payment/closing-cost assistance is being made available to individuals and families who have obtained a 30-year fixed rate FHA or VA loan and meet other program requirements, to assist them with overcoming a final hurdle in the home buying process.
While this program is not ideal for everyone, we are pleased with the response and positive impact that the program is having on the community.
During the first six months of the program, Home in Five Advantage has facilitated 175 qualified low- and moderate-income households to achieve the dream of home ownership, and initiated 25 more homes into the process.
The average home purchase price during this period was about $158,000 for a total value of more than $27 million in home sales, and roughly $1.3 million in down payment assistance. These home sales are contributing to the economic recovery and stabilizing neighborhoods in 20 cities throughout Maricopa County, including 50 home closings in Phoenix, where most of these purchases occurred, followed by 24 in Mesa; 17 in Glendale; 14 in Chandler; and 13 in Gilbert.
Collaboration is nothing new to the Phoenix IDA. Since 1981, the Phoenix IDA has worked with organizations to provide access to capital in the form of low-cost bond financing. We assist applicants through the complex process of acquiring bond financing for the purpose of economic development and community impact. These transactions generate fees, which provide the funding for programs such as Home in 5 Advantage. This enables IDAs to further contribute to the economic recovery, without depending on taxpayer revenue.
The program is continuing to have impact on our community. During the early weeks of its next six-month period, approximately $7 million in new home loan reservations was received from participating lenders. We feel strongly that the success of this program translates into a robust local economy. Since we are reliant on the real estate and lending communities to share this option with potential home buyers in order to expand our impact, we hope to engage more members of these communities to help spread the word about our program, and ultimately assist more people to complete the home buying process.
For additional information about the Home in 5 Advantage program and qualifying criteria, go to www.phoenixida.com.