The increase means more resources to help low income families obtain and maintain homeownership and generational wealth.
Money allocated to the Down Payment Assistance program was tripled in the 2022 fiscal year budget compared to the 2021 budget increasing from $1 million to $3 million.
The program provides a partially forgivable loan with a 0% interest rate covering up to 20% of the purchase price of a home to people with low to moderate incomes. At the end of a specified period, 50% of the loan is forgiven.
Louisville Mayor Greg Fischer says the program supports his administration’s commitment to close the wealth gap between minorities and white residents and help low-income families access homeownership and generational wealth.
“It's one of my favorite programs because it changes people's lives,” says Fischer.
Mayor Fischer says the boost will benefit 150 new homeowners. The average payout from the program is $21,706 per applicant. It is not limited to only first-time homebuyers.
“When most of your paycheck is going toward rent, utilities, food, and other necessities, it's sometimes difficult or impossible to save up for a down payment on a home, and that's where the Down Payment Assistance Program comes into place,” says Mayor Fischer.
Funding for the Home Repair Program which covers critical home repairs like roof leaks and major electrical and plumbing issues was almost doubled to $5.8 million.
The program was designed to stabilize the homes of low to moderate income individuals who own and are currently living in a single-family home.
“According to data from the Federal Reserve, 12% of adults would be unable to pay their current month's bills if they had an unexpected $400 expense that they had to pay,” says Fischer. “We don’t want someone having to choose between paying their mortgage, buying food or having air conditioning, electricity or water. Those are just not simply good choices,” says Mayor Fischer.
The average payout for the Home Repair Program is $24,000 per applicant.
Fischer says he plans to continue to invest in affordable housing and eliminate barriers for those wanting to buy a home.
“This makes all the difference in the world and it's wonderful to see people staying in their homes, people buying new homes and just the impact that's going to have on them and in generations to come,” says Fischer.
Melanie Coleman rented the same house for nine years, but her goal was always to buy a home to build equity and permanency for her family.
“It just made way more sense to pay the bank and have it gone toward me, or rather than paying somebody who at any time with a 30-day notice could tell me to leave,” says Coleman.
With bills and other necessities, she was never able to save the money for a down payment.
“I just tended to prioritize getting the things that made my family happy over. If they wanted toys I'd get them toys, they’d want to go to dinner, they wanted birthday parties and that seemed to take a little more, I guess lifelong memories.” says Coleman.
That was until August of last year when she applied for the Down Payment Assistance Program through Louisville Metro’s Office of Housing.
Three months later, she moved into a brand-new home.
“Honestly, I'm sure I would have found a way, but it would have been really stressful, and probably taken a toll in that regard and I wouldn't have gotten as good of a house. There would have been a lot more stress, and it probably would have been at least two or three years minimum,” says Coleman.
Individuals at or below 80% the area median income are eligible.
The application for both programs opened July 1. Since then, the office has received 800 applications for the Home Repair Application. Due to the demand, it has been closed for the time being.
Individuals interested in that program are told to check back in October.
For more information on the Down Payment Assistance Program, click here.