Some Foreclosures Preventable But Many Others Are Not
A dream log house in West Tisbury could not be save from foreclosure – dues had ballooned to two and a half times more than its original value. It was double the maximum resale permissible price allowed in the deed’s affordable housing covenant. The price being too steep officials of an organization, The Island Housing Trust, could not save it.
But in another instance they met with success in Oak Bluffs. They bought it and then resold it with the permission of the trust that held the property.
Because of non-inclusion of riders or covenants the risk is there that other properties could be at jeopardy. It is not at all complicated – a $10 second mortgage serves as an automatic alert to the holder of the lien of any deals like refinancing or sale.
These deed riders are effective only for a stipulated number of years. Very few are in perpetuity because the state lays down that these are for buyers whose income is 80% less than the average. Most buyers are well above this line. The towns that have established the affordable plots are not getting timely warning of any complications that arise on the properties.
Here time is the key factor. In one instance the town official had only 30 days in which to exercise its right of refusing to purchase the unit. In one such instance the representative of the town Ms Wansiewicz asked the bank for time to arrange matters with qualified buyers. The bank did not bother to reply. She went to the auction on September 4th with a copy of the covenant stating the resale price limits. But for all the noise and hullabaloo nothing positive resulted. The auctioneer claimed after few days delay that the unit had been sold to a bidder – Saxon Mortgage Company. Apparently the original lenders Freemont Investment had filed for foreclosure in February 2007 and assigned it to Saxon in July. The moot question behind all this maneuvers is that how did the property owner qualify for such a jumbo mortgage and that too without coming first to the town authorities? Affordable housing is about community investment. It must be well guarded to prevent dangerous cracks from developing.
The land trust and housing authority have but one prime aim – to see that affordable properties remain so for all times to come.
Related Posts
