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New Homes Created Out of Foreclosure in Lexington

Tuesday, 01 08, 2013

Community Ventures Corporation, in partnership with the Governor's Office, the Attorney General's Office, Kentucky Department of Local Governments, Kentucky Housing Corporation, NeighborWorks® America and other partners showcased what can happen to foreclosed properties when government and the private sector work together. Today, the Hartford Place Apartments were highlighted congratulations were made and partnerships were celebrated with all of the partners at CVC's headquarters.

CVC's purchase of Hartford Place coincides with the Commonwealth's neighborhood revitalization mission of acquiring and providing safe and decent affordable rental opportunities to low and middle income residents and returning foreclosed properties to a useful community asset.

Kevin R. Smith, President and CEO of Community Ventures Corporation praised the public and private partnerships that made it possible for 49 families to have safe and affordable housing in Lexington. "Without all of these partners coming together, it couldn't have happened," he stated. "Families on Martha Court now have a place to call their own. Some of these folks have been through foreclosure and had to leave their home. Through this project, they have landed and can be successful as renters."

Gov. Steve Beshear said, "Returning properties to useful community assets is important for our neighborhoods and our families. This project creates pride and a sense of personal investment for everyone who has been part of the work to turn these homes into useful properties. I applaud everyone involved in this partnership, including DLG Commissioner Tony Wilder and Kentucky Housing Corporation CEO Rick McQuady for stepping up and allotting state funding to support these efforts."

Attorney General Jack Conway secured $58 million on behalf of Kentuckians through the Mortgage Foreclosure Settlement with five of the country's largest banks. General Conway and 47 other attorneys general found that the banks had "robo-signed" documents, which is illegal. Thirty eight million dollars of the settlement is being allocated to consumers through the national settlement administrator. Consumers may receive assistance with refinancing, loan write downs, debt restructuring and/or cash payments. The remaining $19.2 million went to agencies in Kentucky that create affordable housing, provide legal relief or legal assistance to homeowners facing foreclosure, redevelop foreclosed properties and reduce blight created by vacant properties. "Hartford Place is an example of how these funds have the ability to transform streets, neighborhoods and lives," General Conway said. "This settlement is about second chances for properties and people. I appreciate the investment in this property that will provide affordable and safe housing to families in Lexington."

The Hartford Place Apartments (1598 Martha Court, Lexington KY 40505-2969) are located in north-east Lexington just off of Eastland Parkway. The project consists of three buildings with a total of 49 units. The first building has sixteen two-bedroom, three one-bedroom apartments and one manager's office. The back two buildings have fifteen one-bedroom/studio units each. The property was a foreclosed property for sale by lender. At sale, the property had only a 70% occupancy rate and needs rehab due to poor physical condition of many of the units.

Project scope of work includes:

  • Complete rehab of the currently vacant 16 units
  • A new more efficient HVAC system will be installed into the one and two bedroom units
  • New HVAC units installed into all of the vacant studio units
  • One unit will be updated to meet handicap accessible criteria
  • All units will be rehabbed as they become vacant
  • Resident services will be provided including online financial literacy and homebuyer education as appropriate

Funding Partners:

  • Attorney General: $600,000
  • KY Department for Local Governments/NSP: $734,000
  • NeighborWorks America/CFRAH: $300,000

Facilitating Partners:

  • Kentucky Housing Corporation
  • Central Bank
  • Kentucky Bank
  • NeighborWorks Alliance of Kentucky

Data

Realizing that when a family's home has gone through foreclosure, those people have to live somewhere, the rental market is a viable resource for many of these families. The number of households moving from a foreclosure and homeownership to renters is evidenced by a steady decline in the number of single-family residence sales from 2005-2011, a reduction of over 125% (6881 in 2005 to 3028 in 2011). RealtyTrac, 2012

In Fayette County, foreclosures have gone from a low in 2005 (298) to a high in 2009 (609) dropping again in 2011 to 495. However, 2012 has shown a large uptick to a current 791 as of 12.12.12. 2012 Annual Report, Fayette County Property Valuation Administrator

We do not know how many of the new residents moving into the Hartford Place Apartments were former homeowners affected by foreclose. As new tenants move in, this information will be collected.

Community Ventures Corporation

Founded in 1982, Community Ventures Corporation (CVC) is a community-based, non-profit organization that exists to improve the quality of life for urban and rural residents throughout Kentucky.

CVC's central mission is to provide individuals and families with the skills, income, and assets they need to achieve financial independence.

CVC helps people increase income and build assets with three main strategies

  • Small Business Ownership
  • Home Ownership
  • Job Creation Through Business Expansion

CVC's Impact over 30 Years

  • Number of families funded for home ownership: 416 with $61,152,000 in funding
  • Number of families counseled or saved from foreclosure: 2,177
  • Number of jobs created or retained for Kentuckians: 10,663
  • Number of families funded to start or grow a business: 4,705 with $176,600,000 in funding

Total Funding For Kentucky Families: $237,752,000