REMOVING THE BARRIERS

1.  LAND ASSEMBLY ASSISTANCE

• Problem Statement:  Land is becoming more expensive.  Developers hoping to do build houses on vacant lots in distressed neighborhoods have difficulty in obtaining title
  
  
• CREDIT LINE FOR ACQUISITION (mixing grant and loan): working through selected nonprofit intermediaries (or working directly through selected developers) aggressively seek out the owners of vacant lots and negotiate purchase contracts.  Pay for the land using a pre-negotiated line of credit that combines grant funds with private sector financing.
  
  
• Grant Funds: A logical source might be HOME funds provided by local government.  Grant funds are needed because overly high land prices may make an otherwise desirable acquisition economically unfeasible.
  
  
• Private Sector Financing: possible sources include: credit  lines from banks (or bank consortiums such as Neighborhood Lending Partners); a Section 108 loan; a FannieMae loan; a "program related investment" from a foundation; an equity pool (built on a possible use of the New Market's Tax Credit program).

• The Key;  The line of credit would have to be readily accessible once a purchase contract for a lot had been executed (most contracts require closing within 30 days)
  

• FORECLOSE ON LOT CLEARANCE LIENS: local governments should aggressively pursue judicial foreclosures on their huge inventories of potential liens for lot clearance violations. At present these so called "liens" are typically not recorded in the Public Record.  An aggressive program of judicial foreclosures would provide a huge incentive to owners to sell their vacant lien infested lots at a more reasonable price (plus many of the lots would end up being owned by local government who could then deed them to participating developers)

• CHANGE STATE LAW ON TAX FORECLOSURES so as to allow the local governments to directly acquire ownership of selected properties in distressed neighborhoods. Speculators use the present "tax certificate" process to snap up vacant delinquent parcels and then sit on them without being required to develop new housing.

2.  Developer capacity:

• Identify capable developers who are (objectively) ready, willing and able to perform.

• Continue support for South Florida LISC Community Development Training Institute at Florida International University

3.  Construction Financing:

• Developers that hope to acquire lots on an ongoing basis could get bogged down having deal with separate closings on multiple construction loans. Typically bank loans are collateralized with specific parcels that are already owned by the developer. There needs to be a way to avoid separate construction loan closings for developers who will be acquiring lots on an ongoing basis..

• There is a need for a revolving line of construction credit for developers who are engaged in an ongoing program of acquisition of additional parcels

3.  Affordable Financing for the Homebuyers:

• There is a need to speed the processing time for Surtax/SHIP loans closings

• Perhaps combine the SHIP/Surtax second mortgage underwriting with the underwriting that is always done by the private sector first Mortgage lenders.

• Increase amount of funding available for Surtax/SHIP loans.  Here are some ideas:
  

• Sell more closed SHIP/Surtax loans on a secondary markets (such as the Neighborhood Reinvestment Corporation)
  

• experiment with 40 year mortgages, interest only loans, reverse mortgages, etc.

• Better coordination of the lending programs of the City of Miami, HFA, Surtax, and MMAP

3.  Homebuyer training and assistance:

• Homebuyers need both pre-closing and post closing assistance.

• Expand funding for proven homebuyer education programs such as those run by Haven Development Corporation, Miami-Dade NHS, and the LISC sponsored homebuyer education partnership.
  

4.  Expedite the permitting process

• The approval process needs to be streamlined and accelerated for scattered site development of single family infill housing.  Suggestions include: "One-Stop Shopping" (all services surrounding the permitting process should be obtained from one designated department); set mandatory deadlines for smaller projects, assignment of facilitators, fast tracking smaller infill projects; pre-application meetings; adhere to minimum standards (reviewers should not be able to required small infill developers to build above and beyond the stated minimum code standards); self help inspections (allow inspections by certified architects rather than county staff)