Northwest CAA administers the Downpayment Assistance Program (1) to promote homeownership among low-income and moderate-income families and (2) to promote job opportunities through economic growth in the county's manufacturing sector.
The Downpayment Assistance Program was developed as initiative of the Roseau County Affordable Housing Program that was established as a unique Public-Private Partnership. The downpayment component of the program is also offered in Kittson County. A concept paper describes the formation of the partnership in response to the relationship between economic growth and affordable housing. Many manufacturing jobs were located outside of the region due to an inadequate supply of affordable housing.
Loans are available for purchase of an existing house or for new construction. Families may apply for assistance according to a needs based formula. To establish need, liquid assets of less than $10,000 are exempted. If liquid assets exceed $10,000 the borrower must use their funds (the amount in excess of $10,000) toward the downpayment and closing costs first. Downpayment deferred loans (when available) are then provided (generally not exceeding $4,000) in conjunction with a downpayment low-interest loan up to $15,000.
For purchase of existing houses, low interest loans of $5,000 are available to assist with downpayment costs
For construction of new housing, forgivable loans of $8,000 and low interest loans of $5,000 are available to assist with downpayment costs
A $100 application fee is required and refundable if the family does not participate in the program. Loans may be used for downpayments and closing costs. A Repayment Agreement specifies the terms of the loan.
The Downpayment Assistance Program is funded through a grant from the State Housing Finance Agency, along with local government and business support. Cash support is provided by each of the two counties served ($25,000 each) and either cash or land donations are provided by the small towns served ($5,000 or parcel of land). Businesses generally provide an amount equal to 50% of the low-interest loan and this is matched by the jurisdiction where the house is being bought or built.
Families are required to participate in a Homebuyer Education program before they can become eligible for assistance. Two four-hour sessions are provided covering topics related to purchasing and owning a home.
An Advisory Board is involved with the program to review staff recommendations concerning families to be assisted. Members of the Advisory Board include representatives of local businesses, lenders and Northwest CAA.
The Downpayment Assistance Program addresses two of the national ROMA goals:
- Goal #1: Low-Income People Become More Self-Sufficient
- Goal #3: Low-Income People Own a Stake in Their Community
Randy Nordin, Executive Director