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Loan programs offer opportunities for home ownership and reinvestment 

A guiding principle of Woodbury's 2040 Comprehensive Plan is to "encourage the development of a diversity of housing to accommodate people of all ages, income levels and family status." With respect to housing affordability in the community, the Housing and Redevelopment Authority (HRA) offers two loan programs that can help income-qualified households purchase their first home or renovate a home that they already own.

Woodbury First-Time Homeownership Program
The Woodbury HRA has operated its First-Time Homeownership Program since 2009 providing low-interest $25,000 deferred loans to income qualified first-time homebuyers. The structure of the program can help a homeowner save $250 to $400 per month given the deferred nature of the principle, the low interest rate, and the fact that the Woodbury loan will help reduce or even eliminate the need for private mortgage insurance.

Following a discussion at its Oct. 21, 2020, workshop meeting about the city's update to its Housing Action Plan, the HRA authorized a new component to the First-Time Homeownership Program that offers a 0% interest rate to first-generation homebuyers, making an already effective affordable housing tool even more helpful to first-generation buyers.

The HRA prioritizes the stewardship of its public dollars and requires full manual underwriting of all loan applications. While this necessitates a 30-day review period for all loan applications, it has also led to a default rate of less than 1%, a number far lower than commercial lending standards.

Learn more about the First-Time Homeownership Program

Neighborhood Reinvestment Fund
The Neighborhood Reinvestment Fund is a companion program to the First-Time Homeownership Program and provides 3% interest loans to income-qualified borrowers. The loan program was designed to ensure that Woodbury ages with grace in the coming years as well as offering the ability to provide a resource to a resident as the city works through code enforcement activities. Eligible projects include renovation that remedies a code violation as well as exterior improvements such as new roofs, siding, windows or interior improvements that would increase the value of the home. Also eligible are any improvements that address health and safety, habitability, energy conservation or accessibility. Ineligible improvements include recreational improvements, working capital, payments for owner's labor, debt service or refinancing existing debts.

By way of a real-life example, Ken R., a homeowner in the Park Hills neighborhood of Woodbury recently used the Neighborhood Reinvestment Fund to replace the 1960s-era windows in his house. 

"The program allowed me to get a second mortgage at a low interest rate to cover the costs of the improvements, which made my home more energy efficient and livable," Ken explained. "I installed eight new windows, a new exterior door and gutter screens as part of the program. Without this funding, I would have been waiting for years to make the improvements to my home. I cannot say for sure that my heating bill is lower, but I know now that my bedroom no longer has drafty windows that made it uncomfortable when there was a breeze or in extreme temperature conditions." 

Ken recommends other residents consider if the program also is a good fit for them. 

"All the persons I spoke with were very helpful in walking me through the program steps and details," he added. "I would definitely refer the program to other Woodbury residents. It does take some effort and organization as a homeowner to work through the steps of the program, but I think it is worth the time and effort."

Learn more

Woodbury's HRA (the HRA's board is composed of the Mayor and Councilmembers) continues to find success with its loan programs it launched in 2009, having since issued 258 loans in the total amount of roughly $6.135 million through the end of 2020. In addition to helping provide housing affordability within the community, the programs described above help ensure that Woodbury employers have access to the workforce they require while also providing access to capital to residents in need of making repairs and updates to their homes.