The Land Bank made homeownership near Lopez’s childhood neighborhood affordable
Jose Luis Lopez wanted to live in the Hermosa neighborhood, where he was raised. But the home prices are high, and that made it hard for him to get a bank loan.
“Because I am self- employed, it’s complicated to get lending at a high price point,” said Lopez, who has his own home inspection business.
Lopez learned about the Cook County Land Bank Authority’s Homebuyer Direct Program, which sells vacant homes to homebuyers at below-market rates, as long as they rehab the property and then live in the home.
So, when Lopez found a three-bedroom home in the Hermosa neighborhood on the Land Bank’s website at a price he could afford, he submitted a bid for $179,900 and was awarded the home in September 2018.
“With this program, I qualified for a loan amount in an area I want to be in. I grew up just a few blocks away,” said Lopez.
At the time of purchase, Lopez’s home was valued at $200,000, which means he gained immediate equity of $20,100. Lopez spent about $15,000 renovating the home, including a new kitchen and bathroom. The house appraised at $250,000 when he closed.
In addition to getting his home at a great value, Lopez said he likes that he didn’t have to compete with developers or rehabbers, who likely would have outbid him for the property. Although community-based developers can buy properties from the Cook County Land Bank, they are not allowed to buy properties that are in the Land Bank’s Homebuyer Direct Program.
Said Lopez: “They specifically said they will not sale to rehabbers, so I thought this was incredible.”
It enabled him to buy a home in an area he could not normally afford.
His new home is in the neighborhood where he was raised.
He gained immediate home equity valued at $20,100 at the time of purchase.
He increased the economic value of his home by $50,000.