Innovative Land Bank program hopes to lure homebuyers to Circle East District
By Jeremy Nobile – Crain’s Cleveland Business
Homeowners looking to move into Cleveland’s burgeoning Circle East District by University Circle may be eligible for up to $40,000 in financial assistance — and possibly more — through an innovative new program from the Cuyahoga County Land Bank.
Ground broke on the Circle East District earlier this year, and many of the 200-plus homes in the new are still being finished.
This assistance is only available to individuals planning to live in those homes. In other words, investment buyers are not eligible.
The foundation of this program is a partnership between the nonprofit and FNB Corp.’s First National Bank, a Pittsburgh-based lender with a significant presence in Northeast Ohio.
The $40,000 comes from a $20,000 builder interest rate buy-down, which is made possible through a grant from the land bank, plus $20,000 from FNB. The latter includes $15,000 in down-payment assistance with an additional $5,000 applicable to closing costs.
The interest rate buy-down piece is a standout component of the program, which also marks the nonprofit’s first partnership with a private lending institution.
“What makes this especially noteworthy is that the $20,000 incentive is being used to buy down mortgage interest rates, making monthly payments more affordable, a strategy not currently employed in any other Land Bank-affiliated homeownership programs,” Dennis Roberts, chief strategy officer for the Cuyahoga County Land Bank, told Crain’s. “In addition, this initiative is layered with other powerful affordability tools, including the 15-year 100% property tax abatement, and solar panels and EV-ready homes that reduce long-term utility costs.”
Roberts said the nonprofit talked with several lenders about ways to make homebuying in the Circle East District more attractive and affordable by mitigating potential monthly costs. The land bank opted to work with FNB because it provided the most compelling and innovative idea.
“FNB emerged as the standout partner during these discussions because of their strong presence in the region and because they brought forward a creative, mission-aligned solution,” Roberts said. “Their willingness to leverage $20,000 in grant funding to buy down interest rates — rather than applying it only to down payments or closing costs — showed a unique understanding of what would truly move the needle for today’s buyers.”
“At FNB, we believe in the power of partnerships to promote economic growth and reimagine our communities for a stronger future,” said Vincent Delie Jr., FNB’s chairman, president and CEO, in a statement. “FNB’s partnership with Cuyahoga Land Bank and the new University Circle branch are the latest examples of our long-term investments in initiatives that drive prosperity in the Cleveland region. Our commitment is to participate in economic success for all our neighbors.”
Read the full story on Crain’s Cleveland Business HERE.