First Time Home Buyers Program

The Village passed an ordinance in 2016 to provide a loan of $10,000 at 0% interest to first time home buyers to help with their down payment when buying an affordable housing property. All six of the initial buyers for the Orange Lane affordable housing took advantage of the down payment program.

According to the Village website:

Every year the buyer lives in the home and does not default on the program, the balance of the loan is reduced, or “forgiven”, by 10% ($1,000) up to a maximum reduction of 90% ($9,000). When the homeowner who used the program decides to sell the home at any time after 10 years, only $1,000 will be required to be repaid to the Village. Prior to 10 years, the homeowner will owe the balance of what hasn’t been “forgiven” every year. For example, if the homeowner sells the home seven years after purchase, he or she would owe the Village $3,000.

On December 17, 2020 one of the affordable homes at 97 Orange Lane sold. The warranty deed from that sale states that it is deed restricted subject to the restriction at BOOK 2961 at PAGE 1996 of the public record. That deed restriction is a 10 year deed restriction even though the BPAS affordable allocation for this home required a deed restriction in perpetuity.

All properties that have been purchased using this first time homeowner program have a 10-year deed restriction recorded according to the public records. All but one were built using BPAS allocations requiring a deed restriction in perpetuity.

The Village code is clear: For all residential dwelling units having deed restrictions recorded on or after January 1, 2007, the deed restriction binds the dwelling unit and all subsequent owners of the dwelling unit in perpetuity. The deed restrictions shall be submitted in a form approved by the village attorney. 

This first time home buyers program was created in 2016. Isn’t it clear that these deed restrictions must be in perpetuity?  Why aren’t they? Didn’t the Village Attorney catch this?

Islamorada Offers Down Payment Assistance for Affordable Housing

Click here to read the full description of the program on the Village website:   

Click here to see the 2019 mortgage that requires that the loan balance be returned to the Village if the property is sold or leased.

Click here for warranty deed from December 17, 2020 referring to a 10 year deed restriction.

Click here to see the 10 year deed restriction recorded in 2019 – after they were required to be in perpetuity.