Making Homeownership Attainable on Cape Cod

HAC’s Karin Bar manages Barnstable County’s Down Payment and Closing Cost Program.

Sometimes the difference between becoming a homeowner on Cape Cod and remaining a renter is the matter of a few thousand dollars. Over the past three years, HAC Housing Counselor Karin Bar has seen the impact this kind of money can have in realizing the American dream as the administrator for Barnstable County’s Down Payment and Closing Cost Program.

HAC has managed the program for more than two decades, providing first-time home buyers who meet income eligibility requirements with the funds they need to purchase a home.

How effective is the program? Last year, HAC gave away $250,000 to 20 households on Cape Cod. Those no-payment, zero interest loans ranged from just over $3,000 to $20,000; the average loan was roughly $14,000.

The program is federally funded by the Department of Housing and Urban Development (HUD). Loans can only be used for homes in Barnstable County; in 2016, loan recipients purchased homes in Barnstable, Centerville, Marstons Mills, Yarmouth, Sandwich and Harwich. When one of these homes is sold, the loan will be returned to the county so the money can be used again for the same purpose.

Last May, the county raised the loan amount from $10,000 to $20,000, allowing applicants “to qualify for different loan programs and a slightly better house,” Bar said.

Those who benefit from the program tend to represent Cape Cod’s workforce. “These are teachers, bank employees, contractors, one person who works for DCF [Department of Children & Families], chefs, school administrators and health care workers,” she said, adding that the age range goes from those in their 20s to people in their 60s.

To qualify for a down payment or closing cost loan, Bar said, applicants need decent credit and have to be able to obtain a preapproval letter from a lender as well as a mortgage.

A Number of Benefits

One of the advantages of the county program, Bar said, is that “this makes housing affordable without creating a deed restriction” on the home. “That is what makes this very attractive.”

It often results in residents reducing their expenses as “their mortgage payment is the same or even less than the rent they were paying,” Bar said.

Home buyers can make these loans go even further with additional mortgage products that includes the Buy Cape Cod and Islands initiative which reduces the minimum down payment prospective homebuyers need to 1.5 percent. Rolled out last summer, the initiative is a collaboration between MassHousing, Bristol County Savings Bank, First Citizens’ Federal Credit Union and Cape Cod Five Cents Savings Bank to help people overcome the obstacles to homeownership.

As to why these programs are important, Bar highlighted several of those who made the jump from renter to homeowner last year, utilizing these HUD funds from the county. Last spring, a single father with a teenage son were living in a one-bedroom apartment in Hyannis. When they moved into their own home, Bar said, “the son actually cried, saying, ‘Thank you for helping me get my own room.’”

One family had been outbid on seven properties before utilizing $20,000 from the program to finally purchase a roughly $279,000 home in Centerville.

For Bar, who also conducts foreclosure counseling at HAC, the program represents the joyful side of her job. “It is fantastic. I get bouquets of flowers and hugs and kisses and tears. It is pretty wonderful. It is very rewarding when there is a happy ending,” she said.