Saving Home Buyers From Foreclosure $1 At A Time

Posted on January 14th, 2008 by saman

In 2006, a million American families lost their home ownerships to foreclosure. The following year, up to 6,276 cases of foreclosure were filed to home buyers in Hamilton County alone. Worst still, this number does not seem to be lessening with time. In fact, it is becoming ridiculously staggering and very much threatening with 40% of increase in foreclosures reported since 2003. Subsequently, foreclosure crisis has caused many homes to be empty, thus affecting a city’s reputation as well as the property values of a neighborhood.

To salvage the neighborhood’s property values and the city’s reputation in general, Cheviot is setting up a trend of obtaining foreclosed houses from HUD’s Dollar Home program, renovating the houses and sells them at affordable cost to those from low and middle-income families.

HUD’s Dollar Home program works in the way that when a federally financed home is foreclosed, all rights and claims over the house revert back to the federal government. The home will then be put on the market by HUD and sold for $1 after 6 months to eligible parties.

Safety-service Director Steve Neal of Cheviot recently forged unique public-private partnerships with local businesses in the city. They plan to fully renovate the house they bought from the HUD’s program, giving the homes a full reboot complete with new plumbing, wiring and necessary appliances. One house on Davis Avenue is currently being rehabbed and Cheviot plans to sell it to an owner-occupant at a very affordable price of around $60,000 once renovation is completed.

Transforming the $1 house into a model home is what Cheviot hopes to accomplish. The plans and partnerships could one day bring an end to the endless cycle where houses get run down by absentee landlords, low-rent tenants and ruthless lenders. Even the construction workers involved with the renovation project of the house in Davis Avenue are eager to work wonders on the plans. They believed that once rehabbing is done, the house would attract the attention of those looking to live on a nice street with decent neighborhood atmosphere.

Mayor Sam Keller of Cheviot will be proposing legislation to the City Council to set up a certain parameters for selling the renovated $1 houses once they are in best shapes. Among the parameters would be that buyers will be subjected to a minimum stay of 5 years should they decide to purchase the house. After the minimum period, they will be eligible to receive a reward of maybe around $10,000.

Keller said that they are planning to buy a second $1 home this January. Although their plans could be seen as if they are trying to become a model to deal with the crisis of foreclosure, Neal insists that the main reason behind the project is not to battle foreclosures per se. He simply wants to “save the heart of the city” out of his love for the city he lives in.