"I am extremely pleased at the development I have witnessed today, said Andrews.  "Over eight years ago we set out to provide clean, affordable and safe housing to the residents of this area and I am gratified that I could assist in making this happen. When work is finished here and at Westfield Acres, another federally funded, $35 million project, we will have reclaimed over 700 new or refurbished units of affordable housing.  The developments we see here today are just the first part of a plan to provide access to affordable housing for South Jersey’s residents.”

Sixty percent of the existing buildings in Phase I at McGuire Gardens were renovated as a result of this initiative for a total of 101 units.  Sixteen new buildings were built, adding an additional 41 new units.  There are a total of 32 buildings consisting of 142 units in Phase I and currently there are 97 families residing in these units.  Construction on Phase II is well underway.  Fourteen existing buildings will be renovated, consisting of 101 units and five new buildings will be constructed, consisting of ten new units.  There will be a total of 111 units once the construction is completed.  There are nineteen buildings in total in Phase II.

Last year, Rep. Andrews joined with Senator Robert Torricelli and Secretary of Housing and Urban Development, Andrew Cuomo to announce a new round of HOPE VI funding in the amount of $35 million toward the redevelopment of the Westfield Acres housing Complex.  The entire Westfield Acres Complex will be constructed in phases over a period of five years.  There will be a total of ten phases of construction for the project with a total of 523 units being built.   Off site construction has already begun and will consist of 100 homeownership townhouse style units with a total of 272 units constructed off site. The HUD grant will also be used to develop a 12,000 square foot community center and will be leveraged to help develop a 19,000 square foot commercial center. 

In an effort to increase homeownership in South Jersey, Rep. Andrews began his day at Bethany Baptist Church in Lindenwold to highlight two new affordable mortgage products, MyCommunityMortgage(sm) and Cool CitiesSM , both offered by Fannie Mae, which will assist in breaking down the barrier to homeownership that exists for lower and moderate income families.  MyCommunityMortgage is a suite of flexible mortgage options for borrowers that earn up to 100 percent of the area median income or approximately $59,000.   This product allows purchasers more options by limiting the down payment necessary to qualify for a mortgage.  Typically, homebuyers are asked to provide as much as 20 percent of the purchase price of the home to qualify for a mortgage.  Due to this barrier, many potential homebuyers are pushed out of the buying market and forced to rent.  Through the MyCommunityMortgage product, lenders are given more flexibility to offer homebuyers mortgages with as little as 1 percent of the purchase price as a down payment. The MyCommunityMortgage product targets middle income consumers for mortgages up to $275,000. 

Fannie Mae's Cool CitiesSM  initiative is a new construction-to-permanent energy-efficient mortgage pilot of up to $14 million for seven New Jersey cities, including Camden.  The new mortgage pilot provides incentives for the construction, rehabilitation, and purchase of energy-efficient homes, and combines the financing steps into one transaction. The New Jersey Department of Community Affairs (NJDCA) will pledge up to $45,000 per property as a forgivable loan to the city for initial construction costs.   The city will receive the funds, and in turn, provide the money to a developer who will construct the home and pass those savings on to the homebuyer. 

As a result of the energy efficient incentive program, these homes are 35 percent more energy efficient than the average new home built in the state.  Homeowners are not only able to afford the initial purchase of the home, but can significantly reduce their energy bills to afford the home's long term costs and continue to save long after the actual mortgage has been paid in full.  In order to qualify, potential homeowners must have household incomes at or below 80 percent of the area median income.  Homebuyers must also contribute 3 percent for single-family homes and 5 percent for two-unit properties. 

“I am here today to thank Fannie Mae for upholding the spirit of the federal charter in which they were founded,” said Rep. Andrews. “I am an ardent supporter of this federal government-sponsored enterprise because of the worthwhile products they put forth, their commitment to working to improve communities throughout our country and the innovative strategies they employ to help families realize their dreams of homeownership.”

For more information on these and other Fannie Mae products click here.

Next, Rep. Andrews addressed the Deptford Rotary Club at the Woodbury Country Club on the importance of fiscal responsibility to ensure continued access to affordable housing.  The Congressman drew a correlation between the recently passed $1.35 Trillion federal tax cut and a future shortage of affordable housing.  Since Congress balanced the budget and put a halt to deficit spending, the federal government has not been the Nation’s top borrower.  As such, a surplus of available capital has existed and interest rates have been low enough to provide adequate incentive for developers to begin to build housing developments and private lower and moderate-income homebuyers are able to afford these new properties.

However, history has shown that this all changes with the threat of renewed deficit spending.  As Andrews explained: “If lenders are convinced that the government will begin to rely on deficit spending to fund its operating costs, the interest rates will begin to rise precipitously.  It is a simple economic equation; as the rates rise, the prospect of developing new affordable housing becomes impossible due to the developers high debt service.  Therefore, the worst thing the federal government could due to hinder the development of more affordable housing is to signal that deficit spending is a possibility as it did last Saturday when the leadership of the House and Senate passed this risky tax cut on the basis of perceived budget surpluses over the course of the next ten years.” 

Rep. Andrews concluded his day at Aurora Financial in Marlton, N.J. to highlight the success of a new law he authored last year that will allow homeowners who originally financed their homes through the United States Department of Agriculture's Rural Housing Service (USDA RHS), to refinance their mortgages at today's competitive rates. 

Currently, homeowners that have refinanced their mortgage with private lenders have done so at some of the lowest rates in 20 years yet lower income homeowners who financed their mortgages with the USDA RHS are forced to pay interest rates as high as 13%.  According to the General Accounting Office, more than 65,000 USDA Rural Housing Service borrowers are paying an interest rate of 9.5% or greater on direct loans from the RHS and approximately 9100 of these borrowers are paying 13% or greater on their loans.  The USDA Rural Housing Service direct loan program is available to borrowers who are at or below 80% of the area median income.  The guaranteed loan program is available to those at or below 115% of area median income.

As a result of this new law, local lenders like Aurora Financial will be able to help homeowners that hold USDA RHS mortgages refinance their homes to take advantage lower interest rates and build equity in their homes.  Currently, over 1,800 New Jersey families have outstanding rural home loans with an annual percentage rate of 9.5% or higher.  These homeowners who have an average home price of $100,000 will save $1,000 or more per year by refinancing their mortgage from an average rate of 9.5% or higher to the current rate of approximately 7.75%. 
 

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