Wilmington City Council is considering a bill that would aid those looking to buy their first home in Wilmington.
The Community Development & Urban Planning Committee passed an ordinance that would form the Wilmington First State Home Ownership Down Payment and Settlement Assistance Program, aimed at trying to help family move into single-family homes or duplexes.
Under the plan, a prospective home buyer could borrow up to 6% of the property's purchase price for settlement and down-payment costs, to a cap of $15,000.
Bill sponsor Councilwoman Linda Gray said the target are those looking to move into homes between $150,000-$250,000, and turn rent into mortgage payments, not those looking for a second home.
"The stipulations are they have to stay in the home for 10 years, or they have to pay the loan back. It is well known that the most difficult part of purchasing your first home is saving for the down payment."
Real Estate and Housing Director Bob Weir said that 10-year agreement is crucial.
"One of the goals is to provide that stabilization so that when someone is purchasing a home, they are part of the community for a period of time that will stabilize. It also acknowledges that at the end of that period, it is forgiven. It's not like giving an umbrella to someone and then taking it back when it rains."
If a homeowner takes a loan under this plan, and moves out before the 10 years, the cost of the loan would be due immediately.
Eligibility requirements include having been a renter of your primary residence for at least the past three years, with the exception of single parents, who have just a one year requirement.
They must also have at least $1,000 of their own money for settlement costs, agree to HUD-certified homeownership counseling, and the home must pass home inspection.
Wilmington saw the amount of people living in their own property drop from 47.2% to 43.3% between 2010-2019, according to the U.S. Census Bureau.
Gray said the program is similar to programs in Chester, Camden, and for city of Wilmington employees.
"In today's environment where we have blighted areas and vacant properties, it's a must that we help people purchase homes and move into neighborhoods, this will help neighborhood stabilization."
The program is expected to be seeded by $250,000 from the Community Development Block Grant from HUD, which would allow at least 16 families to qualify, without any other additional funding.
The bill will go to a full Wilmington City Council vote on February 3.