The city of Youngstown is looking to create affordable housing, provide low-interest loans to homeowners, and create a fund for landlords to borrow from to repair city rental buildings.

Youngstown has decided to take $13 million of its remaining American Rescue Plan (ARP) Act funds and work with the Warren-based 7 17 Credit Union to handle the funds for the three programs.

First Ward Councilman Julius Oliver said by partnering with the credit union, the financial institution has the experience to make this money go further in Youngstown. 

"The more people see investment going into the neighborhoods, the more comfortable you feel in your neighborhood, the more you know accepting you are of your city government and your leaders, that they are looking out for you," Oliver said, "To fill in the gaps of houses and neighborhoods that are that have been torn down, this is phenomenal."

Construction/rehabilitation of affordable housing: $8 million of ARP funds from the city for new or rehabilitated homes in the city. According to the media release, 7 17 Credit Union proposes to parlay the $8 million into housing development and grow it into $35 million worth of discounted mortgage financing. The application for loans for this program won't be available until spring.

To begin development, the credit union will create a $5 million revolving commercial development fund to be used by developers to rehab vacant downtown buildings into residential condos, to build homes on vacant lots, and to develop neighborhoods. After renovation or construction, the units would be sold to homeowners, and the funds would be recuperated to be invested in additional projects.

Homebuyers will then receive a reduced interest rate, which the ARP funds will subsidize. The initiative — the Youngstown Affordable Loan Program — will provide $35 million in reduced-rate mortgage loans, according to media release. Financing will include a 2% rate reduction and no closing costs.

Based on current rates, the principal and interest payment on a $100,000 loan would be less than $500 per month.

"You've got a lot of tenants all around the city that live in rental properties, and they have a mentality sometimes, generationally, that you'll always live in that housing project," Oliver said, "So how do we take, not only the regular citizen in the neighborhood but also somebody that's been living in a project their whole life and convert them both into homeowners and citizens of Youngstown so that the community grows even greater."

Low-interest loans for homeowners: $3 million in ARP funds have been allocated to this Residential Façade Program. By improving houses' appearances, the money will stabilize and increase the value of homes throughout the city. Applications for loans will be available by late winter.

Landlord fund: Eligible landlords can apply through 7 17 Credit Union for a low-interest loan of up to $50,000 for each repaired or renovated property. A single landlord is capped at $100,000. The loan includes a two-percent interest rate for up to 60 months. Applications for loans will be available by late winter.

"We are proud to partner with 717 Credit Union, who has proven to be a true community champion, for such an important initiative," said Youngstown Mayor Jamael "Tito" Brown. "Helping Youngstown residents achieve the dream of home ownership represents a major step forward for so many in our community."

Oliver said this new initiative will also bring more financial literacy into Youngstown. 

"We don't want to put you in a situation where you own a home and then you lose the home," he said, "This is coming with programming. It's coming with training. It's coming with courses that will help people with their financial literacy, help them understand how to buy a home, how to maintain a home."

7 17 CEO John Demmler said he thinks that his institution can do a lot of great things in the city of Youngstown and said the credit union will keep track of where the money is going. 

A city spokesperson said, "The plan is for all distributions to be tracked and accounted for so that there is transparency about where the money is going."

"We're going to provide reporting back to the city on the residential facade renovation programs, and they're going to see kind of a loan-by-loan basis of where those funds are going and what projects those are being used for," Demmler said, "Whether someone's replacing windows or redoing siding. They'll get a full report of that, we'll be working so closely with the city on the new construction. Not only will we provide the reports so that they know where that's going, but we're going to be working side by side with the city. It's not our housing strategy that we're trying to execute. We want to execute City Council's housing strategy."