“I feel like I have butterflies in my heart and they’re tickling me with happiness,” said Olga Soto, as she stood on her porch after returning from closing on her home.
Olga’s home is in the Newberry area, which is part of the Chadsey Condon neighborhood in southwest Detroit. Olga had been renting the house for five years. She was offered the chance to purchase it through Southwest Solutions’ Newberry initiative, which is transitioning 60 rental houses in the 8-block area into affordable homeownership for low to moderate income families.
“When you have an opportunity like this, you have to grab it!” Olga, 49, said excitedly at the closing. “It’s such a blessing to become a homeowner. Years from now, I’ll be telling my grandkids the story of this wonderful day.”
Olga was able to buy the 4-bedroom home for only $35,000, after a forgivable grant was applied to the purchase price of $55,000, under the special terms of the Newberry program. In addition, she received down payment assistance thanks to an extraordinary donation from the Sam L. and Judith G. Yaker Fund. The Yaker Fund gave $2.6M to the Newberry initiative to promote affordable homeownership and neighborhood revitalization.
Olga signed a 15-year mortgage and will be paying $509 a month, with taxes and insurance rolled in. This monthly payment is $107 less than she had been paying in rent. Nonetheless, Olga was worried about other costs that come with responsibilities of homeownership, and she wanted to increase her savings before closing on the home. So she started cooking Puerto Rican dishes and selling them to family and friends to supplement her income. Olga is self-employed, doing tax preparation and childcare.
“I love to cook and I was able to raise the money I wanted,” Olga said. “Now I’m starting to prepare a special Thanksgiving meal for our family. We have so much to be thankful for this year. And I will be saying a special thanks to the Yakers. They changed my life for the better!”
Olga’s family is the 14th to attain homeownership so far through the Newberry program. Just before Olga closed, Sementra Tobey and her son Jermaine signed their mortgage papers.
The Tobeys had been renting their house for six years. Their monthly rent had been nearly $750. Now they will be paying about $250 less per month, including taxes and insurance, for their 15-year mortgage.
“I have so many plans to personalize the home,” Sementra said. “We’re going to paint inside, put up a fence around the yard, and make a nice garden. I can’t wait!”
Sementra and Jermaine participated in Southwest Solutions’ Neighborhood Beautification Day in June. The annual volunteer event focused on the Newberry area this year, and Jermaine served as a “site leader” to clean up a vacant lot near the Tobeys’ house.
“The neighborhood is definitely improving,” Jermaine said. “And as more families become homeowners and are vested in the community, things will get even better.”
The Tobeys and Olga closed on their homes two days before Thanksgiving. Lashonda McKinney closed on her Newberry home last month.
Lashonda started renting the house after she lost her previous home in Detroit to foreclosure during the subprime housing crisis ten years ago. She yearned to become a homeowner again, and was grateful when she was informed about the unique opportunity.
All prospective Newberry homeowners are required to complete a Homebuyer Education (HBE) class. Southwest Solutions provides the class and also offers financial coaching to help the homebuyers with their budgeting and credit so they can qualify for a mortgage. Lashonda earned her HBE certificate at the end of last year.
“Because my monthly mortgage payments are low, I’m planning to pay off my mortgage in less than 15 years,” Lashonda said. “I’m looking forward to owning the home free and clear.”
Of the 60 rental houses that Southwest Solutions is transitioning to homeownership in Newberry, most are occupied and the current renters have priority in buying the homes. The unoccupied houses need rehabilitation, and Southwest Solutions will make them available for sale to eligible families after the work is completed.