(STATEHOUSE) April 9, 2009 - Interested Hoosiers looking to buy a home can now qualify to receive up to $25,000 in zero-interest, non-amortizing loans if they purchase a foreclosed home. "Indiana has been hit hard with foreclosures and with the current economy, the housing market has greatly depleted," said Rep. Woody Burton (R-Greenwood). "Now, potential homeowners can have the opportunity to not only buy a home, but also help redevelop their community and boost the struggling economy. This could not have come at a better time and I strongly urge Hoosiers to take full advantage." Indiana Housing and Community Development Authority will offer up to $15,000, which cannot exceed 20 percent of purchase price, to assist homebuyers with the purchase and/or rehabilitation of a foreclosed residential property located within an area of greatest need. The Federal Home Loan Bank of Indianapolis has also committed to supply loans up to $10,000. Homebuyers may use this money for closing costs and down payment assistance in buying a foreclosed home or residential property. The property must be used as the primary residence. To be eligible for rehab funds, a residential structure must not meet local building code and therefore is unable to be purchased in its present condition. These funds do not have to be repaid as long as home buyers use the home as a primary residence for at least 10 years. If the home buyer sells the home within the first five years, the subsidy is repayable to IHCDA on a shared net proceeds basis. If the home buyer refinances within the first five years, the entire subsidy is repayable to IHCDA. After year 5 through year 10, the homebuyer will retain 20 percent in equity of the award amount per year. According to Lt. Gov. Becky Skillman, the funding will be available to home buyers that are at or below 120 percent of the area's average income and who intend to occupy the home themselves. However, home buyers will be required to participate in 8 hours of pre-purchase education provided by an IHCDA certified counselor. "I applaud the Lt. Governor for all her hard work and the organizations that worked along with her, in making this opportunity available for Hoosiers." The money comes from HUD's Neighborhood Stabilization Program, which allocated $84 million to IHCDA. The state will use $33 million for the Market Stabilization Fund. Assistance from the fund will be available to income-qualified individuals and families who choose to purchase foreclosed homes in areas of the state in greatest need of assistance. IHCDA will work with lenders to establish a list of foreclosed properties, to be displayed on http://www.indianahousingnow.org/ by the end of April.
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