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| Home Front Economy | |
| White backs off 'credit enhancement' with tax dollars | |
| 2009-02-25 | |
| Mayor Bill White this afternoon announced that a plan for the city to pay off some debts for first-time home buyers has been pulled from tomorrow's City Council agenda. Council members are now professing their "embarrassment" about the proposal, which has hit the national news circuit, including drudgereport.com., which picked up this morning's Houston Chronicle story about the plan "This issue has hit a nerve across this country," said Councilwoman Anne Clutterbuck. "Not just here in the city of Houston. Giving people the ability to increase their credit score artificially because we're allowing them to pay off their credit cards is exactly what got us into this (national economic) crisis in the first place." Councilman Jarvis Johnson said the city should continue to help people move from renting to owning. "But I do believe we can do it in a better way, a more thoughtful way," he said. "But we don't want to become enablers, where people count on the city to be the cure-all." The "Credit Score Enhancement Program" would have given up to $3,000 in grants to individuals who are trying to qualify for mortgages through the city's homebuyers assistance program. City officials say some applicants fall short of eligibility by only 10 or 20 points on their credit scores, and paying off some debt balances can quickly improve their numbers. The proposal aroused critics who say the city should not use public funds to help people pay down car loans, credit card balances, or other debts -- even if the slight credit bump would help them realize the dream of home- ownership. "We just can't give away government money to help people with their credit scores," Councilman Mike Sullivan said Monday. "You're giving them other taxpayers' money to pay off the bills." Clutterbuck called the program well-intentioned, but said it would have gone too far. "If this credit crisis has taught us anything, we need to focus on paying off our debts and saving more," she said. "Using government money to help someone pay off their debts is not the same as asking them to pay off their debts themselves." The $444,000 proposed for the program is leftover money from a $1.5 million appropriation the city made for emergency home and roof repairs after Hurricane Ike. The city has three programs that provide grants for down payments and closing costs for qualified homebuyers. The most generous one offers a $37,500 grant to buy a home that costs $135,000 or less, but only in certain disadvantaged Houston neighborhoods the city is trying to revitalize. Participants cannot earn more than 80 percent of the Houston median income.
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| Posted by:Fred |
| #6 I think the whole RATINGS SCORE, scam should be flushed with the rest of the toilet load. |
| Posted by: Rednek Jim 2009-02-25 15:41 |
| #5 Any "assistance" will just cause prices to rise. Affordability needs to rise i.e. Prices need to fall. |
| Posted by: Bright Pebbles the flatulent 2009-02-25 10:32 |
| #4 Surely with all the shortfalls in collected taxes, the city can find a legitimate use for the money, like bridge and road repairs necessitated by Hurricane Ike? Putting roofs on schools? The repeatedly selected and usual contractors for those types of work already kick into election funds. They're looking to 'buy' new votes. Helping people move from renting to buying, they could use the same money as 'grants' to first time buyers to pay for closing points if the buyers put 20% down on the purchase. While that would be prudent assistance, the number of 'grateful' constituents is probably too small to bother with when other voting enhancement opportunities 'quietly', outside the glare of the net, present themselves. |
| Posted by: Procopius2k 2009-02-25 08:36 |
| #3 Bread and circuses for everyone! |
| Posted by: BrerRabbit 2009-02-25 06:28 |
| #2 The $444,000 proposed for the program is leftover money from a $1.5 million appropriation the city made for emergency home and roof repairs after Hurricane Ike. Surely with all the shortfalls in collected taxes, the city can find a legitimate use for the money, like bridge and road repairs necessitated by Hurricane Ike? Putting roofs on schools? |
| Posted by: trailing wife 2009-02-25 05:58 |
| #1 I don't like this proposal at all but many "bad neighborhoods" have high levels of renters along with the occasional squatters. Owner occupied homes are clearly the best bet for improvement. |
| Posted by: Dogsbody 2009-02-25 01:26 |