The program includes $15,000 in down payment assistance to urban borrowers who will live in their houses for five years.
An advertisement for home mortgages is shown at a Wells Fargo Bank in Menlo Park, Calif., Thursday, July 8, 2010. Mortgage rates fell for the second straight week to the lowest point in five decades. But many people either don't qualify for new mortgages or have already taken advantage of the low rates this year.
Now the bank's program, called NeighborhoodLift, is coming to the Twin Cities. The program offers qualified borrowers $15,000 for a down payment on a house within the city limits of the two cities. The $15,000 grant is forgiven after the borrower lives in the house for five years.
To qualify, borrowers must have a household income that's equal to or less than 120 percent of the area median income, which in the Twin Cities is about $100,700 for a family of four, according to the bank. It doesn't have to be a first-time home purchase.
Standing on the porch of a recently rehabbed home in north Minneapolis, a local Wells Fargo executive on Tuesday told reporters the bank launched NeighborhoodLift to help revitalize city neighborhoods hit by the housing crisis and address a key barrier to homeownership. Despite ultra-low interest rates and low home prices, many families can't come up with the necessary down payment to buy.
"We know the program will make a difference in these cities," said David Kvamme, CEO of Wells Fargo Minnesota.
The program is a bright spot for a mortgage giant that has come under fire over for foreclosure abuses and a recent settlement of allegations it discriminated against black and Hispanic borrowers during and after the housing boom.
The north Minneapolis house, an old duplex that stood vacant and boarded-up for years, was extensively rehabbed by the nonprofit Neighborhood Housing Services of Minneapolis. The six-bedroom, two-bathroom single family home is now expected to be listed for about $210,000.
Launched in Los Angeles
San Francisco-based Wells Fargo first launched NeighborhoodLift in February in Los Angeles and has been rolling out the program to other cities along with NeighborWorks America, a national nonprofit working on affordable housing that administers the down payment assistance. While the bank's foundation has provided down payment assistance in the past, it was on a much smaller scale that NeighborhoodLift, a bank official said.
Glennis Ter Wisscha, executive director of Neighborhood Housing Services of Minneapolis, said she thinks the program is effective.
"When I've seen this program to other cities, it's jump-started the market," she said.
Interested home buyers can see if they qualify, and get preapproved for a mortgage with any approved lender, at a free two-day event Wells Fargo is holding at the Minneapolis Convention Center on Sept. 7 and 8. The event includes bus tours of affordable homes for sale in Minneapolis and St. Paul.
Interested people can register for the event until Sept. 5 by going to www.neighborhoodlift.org or calling 1-866-858-2151.
Jennifer Bjorhus • 612-673-4683