Mayor Harvey Hall and Local Business Leaders Launch the Public Lease-Purchase Home Ownership Program

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The City of Bakersfield California expands home ownership opportunity for working families through the Public Lease-Purchase program.

Today at press conferences held at Bakersfield City Hall Mayor Harvey Hall joined with the Executive Director of the Pacific Housing & Finance Agency (PHFA), other local elected officials, business leaders and housing advocates to announce the launch of a new home ownership program designed to overcome common barriers to home ownership working individuals and families face in Bakersfield. Called Public Lease-Purchase, this government-sponsored initiative eliminates the need for a down payment and the program pays all of the buyer’s closing costs. Additionally, the program is available to persons with credit problems.

Mayor Hall stated that “many working individuals and families have good, stable jobs but still find it very difficult, if not impossible, to achieve the dream of home ownership. That is why I am happy to support the launch of this new initiative”. Mayor Hall added that “Public Lease-Purchase is one of the few affordable housing initiatives available to moderate-income households. Today’s middle-income families need help buying a home”.

PHFA is a non-profit, regional housing agency created through the membership of over 50 cities and counties in California (http://www.phfa.net ). In December of 2004 the City of Bakersfield joined PHFA. The Agency is charged with expanding affordable housing and economic development opportunities for its members. In 2000 PHFA sponsored a pilot version of the lease-purchase home ownership program and many families were assisted. Based on this success, PHFA’s Board of Directors approved a new version of the program in 2004 called Public Lease-Purchase that will be available on a permanent basis throughout PHFA’s member communities including the City of Bakersfield.

Public Lease-Purchase offers qualified home buyers a 30-year rate and term-reset mortgage with no down payment. The program pays all of the closings costs. Up to the first 72 months of the mortgage is the lease-purchase period. During this time the home and the mortgage are held by PHFA. The home buyer, called the lease-purchaser, makes a lease payment that is equivalent to the mortgage payment plus taxes and insurance.     Participants can also use the lease-option period to rebuild their credit record.    Lease-purchasers can exercise their purchase option any time 12 months after the initiation of the lease by assuming the existing mortgage or by obtaining new financing. Then they are the full owner of the home and have access to the equity that may have built-up during the lease-purchaser period. Consumers can choose any home, new or existing, including single-family homes, condominium and town homes. The maximum purchase price is $475,000.

David Elder, PHFA’s Executive Director, expressed confidence that the City of Bakersfield membership in PHFA will pay off big for area home buyers. Bakersfield is a great market for Public Lease-Purchase. “There are many families here who can afford the monthly mortgage payment but just don’t have the cash and-or credit to qualify now”. Mr. Elder noted that one of the great things about Public Lease Purchase is that it represents a new home buying resource in Bakersfield; it does not rely on or take away from existing city subsidies or conventional lending programs. “This is particularly important in a time when local governments like Bakersfield are finding their resources very stretched” he added.

Public Lease-Purchase also expands business opportunities for mortgage and real estate professionals as it opens up the home buying market to more households. The Clearinghouse CDFI is a for-profit, community lender that finances housing and community economic development projects in select communities in California. Doug Bystry, the President and CEO of the Clearinghouse CDFI said his company will support the expansion of home ownership opportunities in Bakersfield through the Public Lease-Purchase program by providing local brokers and lenders accesses to mortgage capital. He added “today’s home buying market can be very challenging for moderate-income individuals. Lenders need more tools to help people get into homes. Public Lease-Purchase is a great resource.”

Real Estate professionals will also be able to use the Public Lease-Purchase program to serve more clients. Jeanne Radsick of the Bakersfield Association of REALTORS® joined today's press conference, stating “this is an innovative approach to buying a home and the Association wishes to encourage real estate professionals to take advantage of this helpful program."

Prospective home buyers are encouraged to learn more about the program by attending a free Home Buyer Information Workshop:

Dates:

Saturday, March 5, 2005

Saturday, March 12, 2005

Saturday, March 19, 2005

Time:

10 A.M. to 12 P.M (all dates)    

Location:

Silver Creek Community Center

Multi-Purpose Room

7011 Harris Road,

Bakersfield, CA 93313

Corner of Harris Road and Reliance Drive

A complete list of additional workshops and other program information is available by calling (877) 873-1988. An online application is available at the program’s Internet website at http://www.PublicLeasePurchase.org.

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