May 16, 2006 CCP - Laserfiche WebLink

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Edina Housing Task Force DRAFT March 2006 low -interest loans and/or defer repayment can help to put monthly mortgage pay- ments within reach of low-income buyers. Upon resale, the equity In the home is split between the homeowner and any mortgage holders, depending on a predeter- mined formula. Second mortgages allow families to have more housing choices avail- able to them. Also, the administrative costs are minimal compared to CLTs. Some- times second mortgages are tied to a "first right of refusal' so that the home can be repurchased by the second mortgage holder or the community entity and sold to another family needing more affordable housing. However, as property values con- tinue to escalate, the size of the needed second mortgage to reach affordability is likely to grow as well. As these or other options are explored more fully, the Task Force believes that im- portant objectives to keep in mind include: 1) the opportunities should be made available for the long-term; 2) the opportunities should be available throughout the community rather than concentrated in a single area; and 3) the opportunities should be seamless, so that no stigma is attached to a particular piece of real estate.