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Affordable Home Ownership
Edinburg, Texas

Edinburg is a city of approximately 25,000 in south Texas. Median income for the area is just over $20,000. The housing authority manages 469 units of public housing and administers nearly 900 Section 8 certificates and vouchers. More than 1,600 families are on the waiting list for housing. In the early 1990s, the housing authority and the city recognized that some public housing and Section 8 residents could become homeowners if they had appropriate, affordable opportunities, and set about to provide them.

In late 1991, the housing authority used a bank loan to purchase 92 lots at auction. The lots had previously been improved using Community Development Block Grant (CDBG) funds. The housing authority and the city then joined together to create the Affordable Housing Program, which is designed to provide special financing and technical assistance to qualified public housing or Section 8 families, enabling them to build new homes on the lots purchased by the housing authority.

The state of Texas awarded the program a $500,000 HOME grant, and a local financial institution agreed to apply flexible lending criteria for Affordable Housing Program participants. A combination of HOME funds and conventional financing was used to finance construction of the first 17 units, which cost approximately $29,000 each.

The program targets families who have demonstrated the ability to pay rent on time, and who have excellent housekeeping skills and a stable work history. Family income cannot exceed 80 percent of median in order to qualify. Applicants are screened by the program coordinator, who works for the housing authority, and then referred to the city's Housing Department.

Applicants are qualified for special financing, which combines a conventional loan at 8.25 percent interest for half the cost of the home and a HOME-funded loan at zero interest for the other half. Up to $5,000 per family in HOME-funded downpayment and closing cost assistance is also available. Monthly payments, including taxes and insurance, vary from approximately $320 to $374. Qualified applicants may select from three floor plans providing either two or three bedrooms as well as other options.

The Affordable Housing Program also provides families with technical assistance regarding home maintenance, money management and mortgage counseling, health care, transportation, child care, and family counseling.

The 17 units in Phase I of the project were occupied in the summer and fall of 1994. In 1995, the city and the housing authority received $360,000 in funding from the state Single-Family Border Initiative Fund to construct 18 more units. Again, flexible financing from a local institution was used in combination with the grant funds. The cost of the Phase II units was approximately $40,000 each. To date, 35 low-income families who formerly lived in public or assisted housing have become homeowners through the Affordable Housing Program. In addition to providing these families with the stability of homeownership, the program has enabled them to move beyond housing assistance. Thus, the Housing Authority has been able to assist families on its waiting list and further alleviate the need for affordable housing in Edinburg.

Contact: Estella L. Trevino, Executive Director, Edinburg Housing Authority, 210/383-5653

Copyright 1997 - 1998 - 1999 - 2000
Affordable Housing and HOME
National Association of Housing and Redevelopment Officials (NAHRO)
630 Eye Street, NW
Washington, DC 20001-3736
Telephone: (202) 289-3500
Fax: (202) 289-4949