Cleveland is poised to receive more than $2.4 billion in federal aid for rebuilding and repairing its flood-ravaged infrastructure as part of a $500 billion federal stimulus package.
But that’s only part of the story.
Here’s a look at what you need to know about the program.
How much will Cleveland get?
The Cleveland program is set to provide $2,000 for every home in the city, and the city’s largest homeowners association says that amount is likely to rise as more properties are bought.
The association estimates that a $1,000 home could cost about $1.5 million.
It’s not clear how many properties would be eligible for the citywide buyback, but there is some speculation that some of the more expensive homes will be eligible.
For example, the Cleveland Housing Authority says the average sale price of an average single-family home in 2017 was $1 million.
The average home sold for about $2 million in 2020.
How long will the buyback be in effect?
The program will run through March 2021, and there will be a 10-year period of buyback.
In 2018, the federal government approved a $2 billion loan program for Cleveland to buy back homes, with a 10 percent interest rate.
Who pays for the buybacks?
The federal government has agreed to pay for nearly 90 percent of the buyout costs, including mortgage payments, insurance premiums and a portion of the cost of the federal disaster relief fund.
In exchange, the city has agreed not to sell any more properties.
How do I apply for the program?
If you want to apply for assistance, go to the Cleveland Economic Development Corporation website and click on “Apply Now.”
Then click on the “Apply” button.
If you have questions, contact the city of Cleveland at 614-292-1470 or [email protected]
Will I be eligible to apply?
If someone gets a mortgage that doesn’t qualify for a federal buyout, the homeowner has to wait a year before applying for the same.
So you may have to wait until 2020 before you can apply for help.
If the homeowner does not qualify, the bank will be responsible for a portion (or all) of the mortgage.
How will I know if I qualify?
The city of Ohio has set up a website to help people find out if they qualify.
When will the program begin?
The first wave of buybacks will begin on February 27.
The city is also providing a 10 cent “buyback fee” to homeowners who want to get started, and they can apply online.
How far will the city take the buyouts?
The buyouts will start on March 15, 2021, with the rest of the program starting on April 10.
How does the buy-back program work?
The purchase-back plan will work in three stages.
The first phase, called “buy-back and relocation assistance,” will allow homeowners to take out a mortgage on a home that qualifies for a buyback in order to relocate to the city and purchase a new home.
The second phase, “buyout assistance,” gives homeowners a $300 federal credit for the first year that they buy a home and $1 to $3 per month for each month that they don’t move.
The third phase, dubbed “resettlement assistance,” offers a $750 federal credit each month for homeowners who qualify for assistance in 2018.
What happens if I move out of the city?
If the city doesn’t offer help, you can file a lawsuit against the city in federal court.
If your home is in foreclosure, you must vacate within 30 days.
The court can order the city to return your home or give it to you as a gift.
What will happen if I get a court order to return my home?
The court will decide if you can vacate your home, but you must pay court costs and fees in the case of a court ruling that you cannot comply.
If there’s a court decision that your home isn’t in foreclosure or the city can’t comply with the court order, you may be able to buy the home from the bank and take out another mortgage, or the bank can sell the home to a nonprofit.
The Cleveland Housing Association says that if the buyer moves out, they may be required to pay an attorney’s fee of $100 per day.