City leaders hope to entice first-time home buyers into choosing Belleville through a program that helps them make down payments and offers extra-low interest rates.
“This could be the incentive to lure some young families to Belleville,”said Ald. Mark Eckert.
The City Council has voted to take part in the Assist home buyer assistance program, which is run by the for-profit Gates Capital Corp. of Chicago.
The program helps families pay for all or most of their closing costs and down payments, and it allows them to borrow at interest rates as much as 2 percentage points below the prime rate. To qualify, families of two may not earn more than $60,120, and families of three or more may not earn more than $70,140.
New homes bought through the program may not cost more than $149,001, while existing homes may not cost more than $123,212.
The program, which is expected to begin in late spring, applies to first-time home buyers and others who have not owned a residence in three years. To enroll, applicants must contact local participating banks.
Eckert said the Assist program is coming at an opportune time in view of the construction of new homes in two subdivisions, Southwind Estates and Galena Creek. It also mirrors a home buyer program offered in Belleville in the late 1970s that enabled Eckert to buy his first home, he said.
Gates Capital raises money for the loans by issuing tax-exempt bonds on behalf of the towns taking part. The bonds are sold at more than their face value. Proceeds are used to make the home loans and offer the financial help. The bonds are guaranteed by the Federal Home Loan Bank, an arm of the federal government, said Mike Qualizza, an analyst with Gates Capital.
Dozens of cities statewide, including East St. Louis and Springfield, are expected to join together in the $30 million bond issue, Qualizza said.
The council also has voted to create the Single Family Land Use Committee, an eight-member panel set up to study zoning laws and devise ways of expanding single-family areas citywide.
