Foreclosed homes in Santa Ana get new life with federal help
The city has begun to buy up foreclosed homes and sell them back to low- and moderate-income people, using millions of federal dollars. The idea is simple: a home with lights on and a car in the driveway is a lot less likely to attract crime and bring down the neighborhood.
The first home bought and sold under that program was a three-bedroom ranch house with wood floors and a big backyard. Anthony Malfavon, 34, and Diana Espinoza, 33, will be moving in today, along with their 4-year-old son Maverick and their pug Kona.
“I love it,” said Malfavon, a construction project manager who, like his wife, grew up in Santa Ana. “I feel like we’ve found our dream house. It’s everything we wanted.”
A few months ago, their house was just one of the hundreds that had slipped into foreclosure or default in Santa Ana. The city has been hit harder by foreclosures than any other city in Orange County; it estimated that it had 1,500 homes in foreclosure and an additional 1,100 in default by late last year.
That’s when the federal government launched a $3.9 billion-effort to steady neighborhoods that had been battered by foreclosures. Santa Ana received nearly $5.8 million under that program. A handful of other cities in Orange County – including Anaheim and Garden Grove – also received federal money.
Santa Ana is using some of its money on redevelopment projects ($300,000), a down-payment-assistance program ($400,000) and to cover administrative costs ($579,515). The rest – around $4.5 million – is going to buy and renovate low-income apartments or foreclosed homes and condos.
The city has hired three outside development firms for the project – ANR Homes to handle houses and condos, Orange Housing Development Corporation and C & C Development to handle rentals. They’ve so far bought 13 houses and condos and a 14-unit apartment building with the money.
They bought the first house in the program out of foreclosure for $295,000 earlier this year. It had bad pipes, bad wiring and structural problems with some of the walls. Workers fixed those problems and added dual-pane windows, an energy-efficient dishwasher and low-flow shower heads.
Its sales price in the end: $400,000, even. The city covered about 20 percent of that cost using the federal money. Anthony Malfavon and Diana Espinoza covered the rest.
They weren’t the only ones who made an offer. Rescued from foreclosure, the house drew 13 offers – all from people who qualified as moderate-income and who could handle a mortgage, with 3 percent interest.
Malfavon and Espinoza won the keys in a lottery-style drawing from among the 13 offers.
They celebrated their new home on Thursday afternoon, cutting a red ribbon across the front door with officials from the city and the federal Department of Housing and Urban Development.
“Everyone always said, ‘When you find the right house, you’ll know,'” Espinoza said. “That’s the one.”
For more information on the program, go to http://www.santa-ana.org and click on “Neighborhood Stabilization Program” under Quick Links.