Neighborhood Housing finances $7.5M of improvements in 10 yrs - Neighborhood Housing Services of New York City Inc.; $7.5 million; ten years

Real Estate Weekly, July 22, 1992

Nearly 20,000 low- and moderate-income New Yorkers have been able to benefit from home renovations over the past 10 years as a result of financing provided by Neighborhood Housing Services of New York City, Inc.

In its first 10 years of operations, NHS has funded 944 small-building rehabilitation projects with loans totaling $7.5 million, giving new life to communities throughout the boroughs and hope to many owners of small properties who could not qualify for conventional bank financing.

The NHS 10-year loan aggregate, for example, includes a mortgage to a 68-year old retiree. This woman lives on a government pension, social security and rental income from two units of a four - unit Bedford-Stuyvesant apartment house which NHS is helping to rehabilitate. She and her sister occupy two of the apartments.

The total loan to her was $24,167, at a 3 percent interest rate and repayable at $167 a month for 15 years. With it, she will install a new waste line, do some painting and improve the kitchen, bathroom, electrical wiring, and windows. All these repairs are considered major, and the homeowner went to NHS after being turned down for a conventional loan, because she found herself in a "Catch 22" situation: Without certain repairs, she couldn't get bank financing; without the financing, she couldn't make the repairs.

Most of the NHS loans average approximately $10,000, and the average client has an income of 77 percent of the city's median income. The loans usually are needed to repair fire damage, fix burst plumbing or take care of some other emergency. NHS makes the loans at below-market interest rates and then works with the homeowner to hire a contractor and monitor the repairs.

This year alone, NHS has lent out nearly $838,977 to fund 78 loans for the rehabilitation of 158 units of housing. These homes are in East Flatbush, Jamaica, Kensington-Windsor Terrace, West Brighton, Williamsbridge/Olinville Wakefield and Bedford-Stuyvesant.

In just one month's time - April 1 through April 30 - the NHS closed on over $264,000 of mortgage loans to improve 14 properties containing 32 dwelling units. These loans ranged from $2,435 at 3 percent interest for a one-family home in Williamsbridge, up to $115,000 at 7.5 percent for a five-unit apartment building in Bedford-Stuyvesant.

Meanwhile, Neighborhood Housing Services of Bedford-Stuyvesant, which opened earlier this year, has received a tremendous influx of loan applications. As of May 1, this NHS office alone had closed on 19 loans totaling nearly $268,000. The properties involved contained 47 residential units.

In the same brief period, NHS of Bedford-Stuyvesant also approved - but did not yet close on - an additional 22 loans aggregating nearly $900,000. Three of the loans included in this NHS financing are for gut rehabilitations and are being augmented by $527,000 of second mortgage loans from the Department of Housing Preservation and Development.