Fairfax County Will Buy Foreclosed Houses

July 6th, 2008 | Tags: Foreclosure House

Fairfax County took a landmark decision by agreeing to buy foreclosed houses to help the middle-income group. It will be a pioneer in the field in trying to tackle the foreclosure menace in a novel way. Simultaneously it will also be addressing the rising demand for affordable housing.

The County will make outright purchases of the foreclosed properties and also arrange for subsidized loans for those planning to build nests at a time when the price of houses is at an all time low. The middle class will be able to move into houses that will match their pockets. It will bring order into areas that are dotted with ugly, abandoned foreclosed homes that in its turn were vitiating the atmosphere of the entire locality.

Gerald E. Connolly, chairperson of the Board of Supervisors said that like the other parts of the country Fairfax was in the grips of foreclosure turmoil. Such a situation has never before been witnessed. Therefore he felt that “the county has to use its resources and influence to try to stem the tide.”

In other parts of the country the problem is being tackled through counseling and some financial help but Fairfax County is going deep into the roots. It has come forward with $10 million from tax revenues for purchasing about 200 foreclosed units. Outright purchase will be made of 10 houses. Buyers meeting certain conditions will be allowed to buy the rest of the houses. They will be sanctioned government supported loans carrying low interest. Buyers will be to avail of these subsidized loans up to a limit of $70,000. New buyers will be given preference if their income average is around $75,600 or 80% of the region’s average income. The value of the house should not exceed $385,000 – excluding condos.

John McClain of George Mason University thought it to be a good idea. He added, “It’s been talked about nationally, and I hope that it will make a dent.”

The foreclosure crisis took on such magnitude locally as well as nationally because loans were given to those who did not have the income to repay it when the monthly payment schedule began to increase. This led to the foreclosure flood. No area or socio-economic group has been spared although the intensity varies from place to place. Recent reports have come in about Washington registering a sharp increase in foreclosures.