Fewer Foreclosures Among Low-cost Brooklyn Homes
November 3rd, 2009
Yvettee Ziegler was one of the many who had a good office job and lived in a rented apartment. She thought owning a unit seemed a pipe dream. But the Nehemiah project has made her dreams come true. It is an affordable housing plan that is run by a church. Today Ziegler is the proud owner of a house having three rooms which she shares with her mother in East New York – a locality in Brooklyn. The programme has constructed over 4,000 units in Brooklyn as well as Bronx starting from the 80’s. Ziegler said, “When it came to light that these churches were building affordable houses and how low the mortgages were, I thought, ‘Well, maybe this is something I can aspire to.”
According to the Bible, Prophet Nehemiah reconstructed the Temple of Jerusalem that had once been the pillar of stability in localities that had been ruined by arson and decay. The mortgage crisis has been the rerun of such a situation. Brooklyn has topped in foreclosure numbers. By contrast very few among those who had participated in this project have defaulted on their mortgages.
Metro Industrial Areas Foundation was the chief architect of the project. Mike Gecan of the foundation said that not more than 10 of the estates constructed by the programme have endured foreclosure. The officials who ran the show said that their success has been because of rejection of the excesses of the exotic loan period. Those who apply get their loans from private lenders or from the city. But Nehemiah includes its own tough conditions regarding income and credit ratings. For example the mortgage payment cannot be over 20% of the income of the applicant.
Gecan said, “At the time [the program began], the conventional wisdom said that people should be asked to spend a third of their income on housing. That is extraordinarily high, and if someone has a family emergency, has a job loss, or if the economy gets weakened, and if they go from 40 hours a week to 27 hours a week, then if you’re spending 35 percent of your income or 50 percent of your income on housing, you’re in trouble.”
The prospective house owners have to give details of their finances inclusive of bank statements. Sudden entry of cash has to be explained to the officials dealing with the programme so as to be sure that the applicants are not dealing in any unlawful activity.
Sarah Plowden is one of the officials of Nehemiah and she is also a house owner. She said, “In our community, there were ways to make money illegally, you know. The organization wanted to make sure they had clean money coming in there.”
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