News - Local News

POSTED: Monday, Nov. 30, 2009

$344,000 federal grant will go to Kulshan trust for affordable homes

Kulshan Community Land Trust will put a nearly $344,000 federal grant toward a project to make 10 homes affordable for Whatcom County residents.

The money came through the Housing and Economic Recovery Act of 2008, which included money for states and localities to buy and rehabilitate foreclosed properties to stabilize the troubled housing market.

The dollars are being sent to the state, then the city of Bellingham, which is contracting with the nonprofit land trust. The money will be used to buy homes or land that are being foreclosed upon or held by lenders, then sold to income-qualified buyers.

To qualify, a single person must have an income of $36,050 a year or less, while a family of three must have an income of $46,350 or less.

The land trust helps buyers bridge the gap between the cost of a house or condo and the mortgage and down payment they can afford. The homes are then kept affordable during subsequent resales.

The federal grant totals $343,666, with $17,183 going to the city for administration of it. The remainder will go to the land trust, which will leverage it for the project to add 10 affordable homes.

"This money has to be combined with quite a few other sources to make that possible," said Paul Schissler, executive director for Kulshan Community Land Trust.

Under the land trust's formula, two-thirds of the funding comes through the homebuyer in the form of a mortgage and down payment that's at least 1 percent, while the remaining one-third comes from other public and private "community investments," Schissler said.

Combined, they form the roughly $200,000 needed for a starter home.

Schissler said the federal dollars come at a time when the state Housing Trust Fund was cut in half this biennium because of budget shortfalls.

And while that's good news, other market conditions during the downturn in the economy are making for mixed results.

"These are opportune times in that mortgage rates are still low for 30-year fixed-rate mortgages, but home prices have not softened in our price range," Schissler said.

"It's still a seller's market - more buyers than homes available - in the starter-home price range," he added.

LEARN MORE

Additional information about Kulshan Community Land Trust and its programs is available at kclt.org.