October 25 Program to Highlight Forgivable Home-Owner Loan Program
Monday, October 13, 2014 - 3:45pm
The third time may be the charm for the "Small Cap TIF" program. After existing for several years in the Basset neighborhood and later the Mansion Hill neighborhood and failing to catch on in a meaningful way, the program has been given a serious boost by the City Council.
The Council recently increased the amount of the top loan from $80,000 to $100,000, expanded the boundary into the Tenney-Lapham neighborhood, and for the first time allowed a developer or other individual to use the loan to improve a former rental property as long as they sell it to an owner-occupant within two years.
To promote the Mansion Hill-James Madison Park Small Cap TIF program, Ald. Zellers and neighborhood leader Joe Lusson have teamed up to organize a program on Saturday, October 25, from 2 to 5 p.m. starting at the Mendota Lake House Bed and Breakfast, 704 E. Gorham Street. Speakers and Q&A will be followed by tours of several homes that have been converted from rental to owner-occupied, are in the processing of doing so, or might be eligible for a small cap TIF loan.
"It's exciting to see these loans already being used in the James Madison Park area," said Ald. Zellers. "And now we have an opportunity to see more investment in the historic housing stock further east, allowing people to buy who might not have been able to afford to without the help of the loans."
The loan program provides 0%-interest loans for converting a rental property to an owner occupied property. It must remain owner-occupied for 10 years, with 10% of the loan forgiven each year until the 10 years are up. If it reverts to rental before the 10 years are up, the owner must pay back a prorated portion of the original loan.
"This is a huge boost to home-ownership in parts of Tenney-Lapham that have seen disinvestment and deterioration but are beginning to be seen as a hot place to live," said Joe Lusson, immediate past president of the Tenney-Lapham Neighborhood Association. "By increasing the money offered and not requiring the eventual owner to do the renovation work, this opens the door to a lot more people."
The October 25 program is open to the public. Speakers will include representatives from the city, Home Savings Bank, TDS Custom Construction, a person knowledgeable in Historic Tax Credits which are also available for some homes in the area and a homeowner who has already used the loan program. Several Realtors who specialize in the central city will be on hand to answer questions.
Loan amounts are up to $80,000 for a single-unit property, $90,000 for a two-unit, and up to $100,000 for a three-unit. If rental units are retained in the home, at least one must be occupied by the owner. The newly covered territory extends from Blair Street east to Brearly Street, covering portions of E. Gorham, E. Johnson and E. Dayton Streets. The original territory still includes Blair Street west through Mansion Hill all the way to campus.
For information on the loan program, call Terry Goldbin, City Economic Development Division, 608-266-4223, or visit cityofmadison.com/homeloans.
- Alder Ledell Zellers, District 2(608) firstname.lastname@example.org