Detroit Home Mortgage, a new mortgage program seeking to increase homeownership, property values, and reinvestment to any part of the Detroit neighborhood where the appraisal gap exists, was made through the joint efforts of Detroit Mayor Mike Duggan, with organizing support from the Obama Administration's Detroit Federal Working Group, the Clinton Global Initiative, local banks, foundations and non-profits.
"This is a game-changer for Detroit," said Duggan. "We are confident that Detroit Home Mortgage will increase homeownership in the city of Detroit. This initiative is critical to rebuilding Detroit's neighborhoods. With an opportunity to get a home mortgage, qualifying homeowners and homebuyers have a real opportunity to buy and renovate a house in the city and make it a home."
According to their press release in PR NewsWire, the Detroit Home Mortgage was developed to provide qualified borrowers to receive a first mortgage for the appraised value of their house (less their 3.5 percent down payment), and a second mortgage up to $75,000 to fill the gap between the appraised value and the sale price and/or the cost of renovations, as opposed to the previous federal lending guidelines that don't allow the bank to loan enough money to the borrower for covering repairs and renovations, due to the limitations imposed by the low, appraised value of a house to the amount of loan to be borrowed.
"The Detroit Home Mortgage program is another example of what happens when the private and public sectors come together to help Michiganders," Governor Rick Snyder said. "I commend Mayor Duggan and all of the partners involved in this effort that will help Detroit's neighborhoods thrive."
The Detroit Home Mortgage Program was made possible due to the efforts of Huntington Bank, Flagstar Bank, Talmer Bank and Trust, FirstMerit Bank, Liberty Bank, the Ford Foundation, the Kresge Foundation, and the Michigan State Housing Development Authority. It was made during the two days of visionary discussions at the Clinton Global Initiative (CGI) America meeting last Summer.
"Once the Mayor challenged the Clinton Global Initiative to find a solution to the appraisal and financing gap, we got to work the best way we know: by bringing diverse partners to the table," said Clinton Foundation President, Donna Shalala. "Beginning at the CGI America meeting in Denver last June, where we gathered representatives of nearly 20 organizations to workshop the idea, today's CGI Commitment to Action is the result of their continued efforts and commitment to finding a breakthrough solution for improving lives and communities in Detroit."
