Georgetown, Del., Sept. 1, 2009: Scratch off at least one vacant, foreclosed home from Sussex County’s real estate market.

With the settlement this week of a two-story house in Milford, Sussex County’s new Neighborhood Stabilization Program is the first in Delaware to put the keys to a formerly foreclosed home into the hands of new owners.

Tia and Donta Moultrie, a nurse and a bus driver, respectively, settled on the property Monday, Aug. 31, using a $30,000 zero-interest loan made possible through the program. That money will pay for closing costs and principal reduction to buy the house located in a single-family subdivision off Elks Lodge Road. The family of five will begin moving into their home this week.

“We’re excited to see this program move from an idea on paper to something that’s in practice, actually helping a real family realize their dream of home ownership,” said Brandy A. Bennett, Sussex County’s housing coordinator. “This is the first of hopefully more than two dozen families we can help through the Neighborhood Stabilization Program over the next year.”

This past spring, the Delaware State Housing Authority allocated to Sussex County $2 million in federal funding for the County’s model of the stabilization program, created under the federal Housing and Economic Recovery Act of 2008.

The program’s mission is to stabilize communities that have suffered from a high concentration of foreclosures and abandonment by offering low- and moderate-income buyers the chance to purchase homes left vacant. The funding must be used by September 2010.

Under Sussex County’s local program, the County’s Community Development & Housing office is using a portion of the federal funding to establish a homebuyer assistance program that makes up to $50,000 in zero-interest loans available to low- and moderate-income buyers purchasing foreclosed homes. The assistance is secondary to the buyer’s principal financing, and is considered a lien on the property, requiring the owner to repay the amount if the home is sold to a future non-qualified buyer.

Buyers must meet eligibility and income requirements, not making more than 120 percent of area median income in order to qualify. For a typical family of four, that would equal approximately $70,000 per year.

Homes purchased must be for primary residences, not used as investment properties or second homes, and must be located within five targeted areas of the county where foreclosure rates have been the highest in the past 18 months: Georgetown, Greenwood, Laurel, Milford and Seaford ZIP codes. Sussex County is partnering with NCALL Research Inc. and First State Community Action Agency to provide federally required counseling for homebuyers making use of the program.

County Administrator David B. Baker said the program will not solve the foreclosure ills that have plagued the economy for the past year. But it’s a step in the right direction.

“One less home sitting empty means someone is living there, someone is earning a living, someone is making use of local goods and services,” Mr. Baker said. “That’s positive, not just for the local neighborhood, but for our local economy.”

For more information on the Neighborhood Stabilization Program, contact Sussex County Community Development & Housing at (302) 855-7777.

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