Among those on hand for the Stamford-based Housing Development Fund’s recent launch of the SmartMove Homeownership Fund were: (from left) Tim Coppage of the Connecticut Housing Finance Authority, John March of CitiMortgage, Joan Carty of HDF and Carl Levinson of CitiMortgage.
It’s a big part of the American dream, but in some parts of Connecticut, particularly in tony Fairfield County, it can be elusive at best.
Soaring home prices in the state’s southwestern corner make it difficult for individuals and families earning low to moderate incomes to afford a house. But that could change for 200 area families after several banks decided to back a fund to help them afford their first homes.
The Housing Development Fund, a Stamford-based group that works to provide affordable housing and offers other programs to help people become homeowners, launched the SmartMove Homeownership Fund, a $9 million second-mortgage fund, during a recent press conference. The fund will help “bridge the gap” between families and homeownership, according to Housing Development Fund Executive Director Joan Carty.
Five banks have committed money for the fund. CitiMortgage will provide $5 million over three years for the fund and the Bank of New York, First County Bank, People’s Bank and the Savings Bank of Danbury each committed $1 million over the next three years, according to a press release from the Housing Development Fund.
“At Citigroup, we are committed to helping make a difference in local communities where our employees and customers live and work,” said Carl Levinson, chairman of Citigroup’s Consumer Assets Division, in a prepared statement. “We are pleased to strengthen this commitment through CitiMortgage’s $5 million investment in the SmartMove Homeownership Fund knowing that it will enable many more local residents of Fairfield County to achieve their dream of owning a home.”
The Connecticut Housing Finance Authority will approve the lenders and the banks will provide the first mortgages to SmartMove borrowers to ensure they receive the most competitive rates available.
“It is heartening to see the private sector take the initiative in providing $9 million in down payment assistance for Fairfield County’s hard-working residents,” said Stamford Mayor Dannel Malloy in a prepared statement. “The SmartMove Homeownership Fund will assist in closing the gap for over 200 households to help them achieve the American dream of homeownership. This partnership of lending institutions and the Housing Development Fund will go far in meeting a critical need in our high-cost region.”
‘Importing’ Practices
The idea for the SmartMove fund came from examples of similar programs around the country, Carty noted.
“This [fund] is the net result of a process of importing best practices from other parts of the country,” she said.
The Housing Development Fund was founded 15 years ago in Stamford with the backing of eight banks. It has grown since then. The program now serves all residents of Fairfield County instead of only Stamford residents and 15 lenders now support it. Before the recent pledge of $9 million more for the SmartMove program, the fund had reached $25 million.
The five banks funding the SmartMove program have been involved in the Housing Development Fund’s other programs intended to help Fairfield County residents purchase their first houses, Carty said. The Housing Development Fund offers several other forms of assistance.
The SmartMove program builds on the success of a homeownership and down payment assistance program called Adopt A House, according to a prepared statement from the Housing Development Fund. Adopt A House offers counseling and assistance for first-time homebuyers. The program also provides down payment assistance through an interest-free loan secured by a second mortgage on the property, according to the fund’s Web site. The loans are repayable after 30 years or when the home is sold or refinanced, Carty said.
The Housing Development Fund also works to promote affordable multifamily developments. It has helped fund the transformation of an abandoned, dilapidated school in Westport to apartments for senior citizens and has helped construct a host of other affordable apartments. The group provides 30-year, fixed-rate financing to developers of affordable housing, offers short-term loans to developers and aids in acquisition, rehabilitation and new construction of affordable units.
“We are very excited about all the possibilities of helping more low- and moderate-income households reach homeownership,” Carty said in a prepared statement. “We are eager to deploy this resource quickly in the marketplace. The SmartMove Homeownership Fund will help many people get a foothold into homeownership. The idea of a second mortgage fund came from the Funder/Investor Study sponsored by the Stamford Partnership in 2003. The Housing Development Fund is proud to be part of moving the idea to reality.”
