In an effort to reduce foreclosed properties and improve houses that otherwise might fall into disrepair, Woodbury city officials have unveiled four programs aimed at helping homeowners and home buyers.

Woodbury had 335 foreclosures last year, the most of any city in Washington County. Home to one of the highest percentages of "married with children" households in the metro, foreclosures in Woodbury hit all portions of the city and income levels, said Karl Batalden, city housing specialist.

"You never want to see a home that's empty," said Batalden, who has fielded dozens of inquiries about the new programs. "We're preserving our housing stock and we're helping our existing residents."

For all of the programs, which loan money at low interest rates, the property value or sale price of a house can't exceed $236,500. That affects nearly 4,500 single-family, detached dwellings in Woodbury, which has an average house value of $303,600, he said.

The programs, administered through the city's Housing and Redevelopment Authority (HRA), are aimed as much at keeping older houses in good shape, Batalden said. People often think of Woodbury as a new city, but it has neighborhoods that date to the 1950s, he said.

The programs are funded with the city's $350,000 HRA levy. Batalden said no grants are involved -- money loaned will be paid back.

Programs available are:

• Home Improvement Fund. Homeowners earning less than $49,200, which is 80 percent of the area median income, can borrow up to $25,000 in a 15-year loan with 3 percent interest.

• Woodbury Goes Green. Homeowners who earn $90,000 per household or less can borrow up to $5,000 to increase the energy efficiency of their homes in a 15-year loan at 3 percent interest.

• First-time Homeowner-ship. Prospective buyers can borrow up to $25,000 on a 3 percent deferred arrangement to assist with closing costs, down payments, or write downs on a first mortgage.

• Foreclosure Purchase. This program aims to decrease the number of foreclosed properties in Woodbury by offering buyers up to $25,000 for closing costs, down payments or the write-down of a first mortgage. To be eligible for a 3 percent deferred loan, households can't earn more than $90,000 a year.

Helping people buy foreclosed homes can help head off deteriorating properties, Batalden said, adding that homeowners should take action fast if they're in financial trouble.

"The key in the foreclosure world is getting help early," he said. "If you wait until that sheriff's sale, it's really difficult to go back and figure something out."

Woodbury's foreclosures last year -- which exceeded earlier estimates -- aren't disproportionately high considering that Woodbury is Washington County's largest city and that 53 of the 335 foreclosures were on vacant lots, Batalden said. And he said that a wave of lost jobs contributed more to the foreclosure problem last year than shaky borrowing practices such as adjustable rate mortgages.

Washington County records show a 39 percent overall increase in 2008 in foreclosures over 2007, which is more than were forecast. Following Woodbury in the number of foreclosures were Forest Lake, Cottage Grove, Oakdale, Stillwater and Hugo, in that order.

It appears the wave of foreclosures will continue, said Rich Malloy, deputy executive director of Washington County's Housing and Redevelopment Authority Board. In December the agency received notice of 244 residents needing foreclosure counseling, a practice that the law now requires, he said.

"I think it's still coming at a pretty steady pace," Malloy, said, adding that like Woodbury's experience, half of all county residents in foreclosure lost their jobs recently. "If December is any indication, it's probably about as serious as it's ever been."

Kevin Giles • 651-298-1554