Cook County Land Bank to sell homes directly to homebuyers
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The Cook County Land Bank Authority, on behalf of Cook County President Toni Preckwinkle and CCLBA Chairwoman Bridget Gainer, is excited to announce the launch of the Homebuyer Direct Program! The focus of this program lies in reaching out to prospective homeowners who may be interested in directly purchasing, rehabbing, and ultimately living in the home of their dreams! With this in mind, the CCLBA is looking to offer properties throughout Cook County to prospective owner-occupants at below-market prices. This could be a perfect opportunity for you to engage in the purchase/rehab, finish it to your taste, and build in some equity!
This not only keeps revenue and jobs in the community, but also helps local developers grow their businesses. The land bank brought in corporate lenders offering purchase rehabilitation loans and is building a list of contractors to share with homebuyers. As part of launching this program, the Land Bank will give away a fully rehabbed single-family home in Auburn Gresham.
Cook County Launches New Home Buying Program
But its interior is a patchwork of exposed wood lath, crumbling ceilings, mold and floors made bumpy by substantial water damage caused by a leaky roof. Like many foreclosures, the home is missing its boiler, water heater, radiators, kitchen appliances and toilets. On the plus side, it is large, the basement is dry, there's a bit of nice molding around some doorways and there are no signs of squatters or animals. The brick bungalow in Chicago's Auburn Gresham neighborhood doesn't look like much from the outside, with its windows covered with plywood, silver tape dangling from a second-floor eave and a blue tarp stretching across much of its roof. The orange kitchen, despite having a coveted island, needs updated appliances, new cabinetry and flooring.
Please check with your lender or with the entity offering down payment assistance. The initiative is also meant to boost homeownership among African-Americans, who are lagging behind whites in owning homes. "This was not a beginner rehab. The house was in pretty bad shape -- a lot of water damage and mold. We took all the walls out, we took all the floors out, the basement out, the roof was redone. Everything is new," said Lavise Giles, GOA Enterprises Development. The $4.5 million allocated to the CCLBA from that settlement – the largest single award of the $70 million allotment – funded the Land Bank’s acquisition of 600+ homes – of which 200 have been rehabbed. The five lenders involved in the foreclosure settlement were Bank of America, JPMorgan Chase, Wells Fargo, Citibank and Ally Bank, formerly known as GMAC. But several of the land bank's properties were more in need of cosmetic changes than complete rehabs.
VIEW HOMEBUYER HOMES
Answers to homebuyers’ frequently asked questions, recommendations for lenders and down payment assistance and an application for the program are all listed on the CCLBA website. Details on how to apply for the giveaway home also are available on the site. They will be the first vacant houses to be overhauled and put up for sale as part of the Cook County Land Bank Authority's ambitious, long-awaited effort to stabilize communities by ridding them of eyesores and attracting new residents and businesses. The first houses as part of a county land bank program are being transferred to developers for rehab and resale.
This fall, the Cook County Land Bank Authority launched the Homebuyer Direct Program to break down barriers to homeownership and help transform communities by offering fixer-upper homes at below-market prices in neighborhoods across Cook County. The new Homebuyer Direct Program focuses on reaching out to prospective homeowners who may be interested in directly purchasing, rehabbing and living in their dream home. The Cook County Land Bank is looking to offer properties throughout Cook County to prospective owner-occupants at below-market prices. This is your clients’ opportunity to engage in the purchase/rehab, finish it to their tastes, and build equity. "Most of the properties need cosmetic work, not a full gutting," said Rob Rose, the land bank's executive director. "These houses are great for a homeowner to come in, make that investment and build equity … because we're selling to you below market."
PROGRAM OVERVIEW
Listing for sale the two rehabbed homes next spring, then selling them, will validate that a land bank can succeed in Cook County, as it has in other cities and counties hard-hit by foreclosures and abandoned homes. The goal is to obtain properties in areas that may be risky but are ripe for a turnaround, clear title to them and find a suitable developer, a process that's more laborious than it sounds, said land bank Executive Director Brian White. Since its founding in 2013, the land bank has identified 13 city neighborhoods and 13 west and south suburbs where it sees potential, and has been acquiring vacant homes to sell.
"That allows the equity to stay with these people of color who've grown up in those areas." It's just one of the 30 to 40 homes the Cook County Land Bank Authority is putting up for sale as part of a new program designed to promote homeownership by selling vacant, dilapidated, tax-delinquent homes directly to homeowners. Of those, 346 homes have been sold to developers and 167 have been rehabbed. It’s just one of the 30 to 40 homes the Cook County Land Bank Authority is putting up for sale as part of a new program designed to promote homeownership by selling vacant, dilapidated, tax-delinquent homes directly to homeowners. To date, CCLBA has sold over 400 homes to community-based developers for rehab. Projections show the Land Bank will have facilitated over $18 million in new home value in this market, homes that will then generate equity for families for years to come.
The CCLBA will turn on utilities if requested by lender; however the properties are being sold “As Is”. Buyers should pursue a Purchase-Rehab loan such as a 203K to purchase the property and complete repairs and updates. Enter the land bank’s new program designed to attract prospective owner-occupants with fixer-upper dreams.
After they close on the purchase of the home for about $45,000 from the land bank, the plan is to gut the two-bedroom, one-bath home, add a second-floor dormer to create a master bedroom suite and sell it for more than $180,000. August 1, 2017 If your client is looking to purchase a home, but is having trouble finding something in their price range, or if they are talking about purchasing a fixer upper, a new program from the Cook County Land Bank might be the ticket. Most of the homes in the land bank's program are in Avalon Park, Roseland and South Shore. Some lenders or entities offering down payment assistance will require homebuyer education.
Through this new initiative, about 30 to 40 CCLBA properties are available to prospective owner-occupants at below-market prices. The homes, which primarily run between $50,000 and $170,000, are located in neighborhoods such as Avalon Park, Roseland and South Shore. Homeownership is one of the primary ways Americans accumulate wealth, and a recent Harvard study shows Black homeownership rates in Chicago have dropped to levels not seen since the 1960s. Launched in early 2013 by the Cook County Board, the land bank has acquired 23 foreclosed properties through either donation or below-market pricing from lenders or Freddie Mac. But several of the land bank’s properties were more in need of cosmetic changes than complete rehabs. Rehabbers weren’t as interested in less-blighted properties because the projects would not produce the desired returns.
Buyers are encouraged to reach out to the local municipality and inquire about occupancy requirements. The only expectation is that rehab complies with all local, county, and state building codes and ordinances. Typically, the lender issues a loan commitment within days and closes shortly thereafter. The Land Bank will look at occupancy, contract contingencies, down payment, and first time homebuyers. The following entails a list of questions and answers you may have regarding the Homebuyer Direct Program.
The land bank aims to make a long-term impact on neighborhoods hit hard by the housing crisis by filling abandoned homes with homeowners, not just renters, said Cook County Commissioner Bridget Gainer, D-Chicago, chairwoman of the land bank. "The Homebuyer Direct Program will now allow us to sell directly to homeowners," said Robert Rose, executive director of the Cook County Land Bank Authority. "We are able to take these fixer uppers and offer them to homeowners to below market prices, give them a chance to build equity, and to customize it to make it their own." In July, the land bank’s strategy took a big step forward when The PrivateBank committed $10 million in purchase-rehab financing to qualified entities that acquire homes from the land bank. Other banks have donated properties and demolition funds, but PrivateBank is the first to make a direct investment with the land bank in communities, White said. Bank of America donated the property to the land bank, and this week, Alpine Capital Realty Group, a local firm that has rehabbed homes, is expected to close on the $3,000 purchase of the home and start a gut rehab.
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