CHARLOTTE, N.C. - Self-Help CU is planning to buy foreclosed homes in a newly built northwest Charlotte subdivision, then either sell them or rent them with an option to buy as part of a pilot program aimed at alleviating the growing foreclosure crisis.
“Our plan is to acquire up to 25 homes, starting with bank-owned properties, fix them up, then put them back on the market,” said Evan Covington-Chavez, head of Self-Help’s Residential Real Estate Team. The 147-unit subdivision, known as Peachtree Hills, is located just outside the city and has a high foreclosure rate, even though it is only five years old. As many as 40 of the houses, most of them bought in the “low $100,000s,” lie vacant, according to Covington-Chavez. Many of the vacant homes have been vandalized.
Because of predatory subprime mortgages, many of the new homeowners have walked away from the properties, unable to pay the mortgages.
“Every time we go out there it seems there’s another house vacated,” Covington-Chavez told Credit Union Journal.
Self-Help plans to buy the foreclosed homes at a discount from the mortgage holders, repair vandalized properties, then either sell them, or lease them with an option to purchase after three years, she said.
The credit union has closed on one of the homes so far and expects to buy several more by mid-June.
Fannie Mae has committed to buy the mortgages of the resold homes, according to Covington-Chavez.
The city of Charlotte has pledged to support the pilot with increased police coverage, solid waste removal and recreational facilities in the neighborhood, as well as some of the renovation costs, said Covington-Chavez. “The point is, this is a neighborhood that has taken less than a year going from a lower middle-class neighborhood to looking like one of the troubled inner-city neighborhoods,” she said. “The advantage to the city is it will take the burden off them.”
“We’re just getting started, but we’d like to see this replicated across the state,” Covington-Chavez said.
