Frequently Asked Questions
What’s different about buying a THLT home?
THLT operates by the "pay-it-forward" model used in community land trusts. In exchange for the significant down payment assistance that THLT provides, you agree to pass on the good deal to the next eligible buyer. The assistance is not a loan that you are responsible for repaying
(as long as you sell your home to another income-qualified household). You earn a reasonable amount of equity during the time you own your home – an incremental increase in value, plus paying off the principle of your mortgage – without pricing the next modest-income household out of the market.
What is a community land trust?
Community Land Trusts (CLTs) are non-profit organizations that help make homes and other land (such as community gardens, commercial space, housing) affordable and accessible. For most CLTs, affordable housing is the highest priority. There are over 250 CLT programs across the country, serving communities from small towns to large cities. See more resources here.
Who buys with community land trusts?
CLT homeowners include all types of people - families, grandparents, couples and single folks. They are grocery store clerks, mail carriers, school teachers, electricians, small business owners, restaurant workers, police officers and more. The people who will purchase homes through THLT’s program are done renting, ready to be homeowners but cannot afford to buy a home on their own. THLT can help you buy a home in good condition near jobs and services, transportation options and quality schools.
What is my home loan like?
Your loan will be a conventional mortgage. We highly recommend that you use a lender from our preferred list because they are familiar with the special issues involved in a CLT home purchase.
What are my down payment options?
Typically our program requires that you put down a minimum cash contribution of $2,500 or 1% of your purchase price, whichever is greater. There may be special grants and subsidies available from time to time. [note: how do we really want to describe the possible availability of the affordability grant?]
Do I own the land?
No. THLT retains ownership of the land in order to ensure that the house remains affordable.
Let us clarify this point:
The ground lease agreement is the key document that ties the land and the house together and is the legally enforceable way to ensure the program requirements are met. This document articulates the "pay-it-forward" approach, allowing the affordability of the home to be kept for the community and future buyers, securing you modest equity when you sell and requiring the home remain your primary residence while you own it.
Most importantly, you are responsible for the land and have the right to landscape and engage in all typical homeowner activities. This is your home—you get to enjoy all the security, control, tax advantages, and equity building opportunities of homeownership. See more resources here.
Can I leave my home to my children?
Of course! The ground lease that secures your use of the land is for 99-years and is renewable and inheritable. This means that you could stay in your home for as long as you live, bequeath the home and the right to use the land to your children and they could do the same – on and on across generations.
What is the ground lease fee?
Homeowners pay a nominal $50 monthly ground lease fee to support us organizationally and continue our non-profit’s work. We include the ground lease fee in the affordability calculations.
Does THLT share the equity I gain?
No, it is all yours. In exchange for the subsidy reducing the price of the home, you agree to sell your home at an affordable price (should you decide to sell), which allows another household to achieve their dream of homeownership.
Homeowners build equity on their homes in two ways. Your home appreciates in value by the resale formula amount, as laid out in the ground lease, and your mortgage principal is paid down. Together, these two factors enable you to build equity throughout your period of homeownership. You can receive capital improvement credits to the resale formula price for making specific property improvements.
You can also receive capital replacement credits to the resale formula price for replacing specific significant home systems.
What about selling my home?
You can sell your home to any income-qualified homebuyer. THLT helps households in selling their home; but you are welcome to find a buyer (a friend or relative even) for your home.
When I want to sell, how is the price determined?
Your selling price starts at your investment in the home (mortgage + down payment – closing costs) and grows by 1.5% [NOTE: HOW WILL WE DESCRIBE THIS???]
annually. If your base price was $200,000 it would grow as follows:
After 1 year.......... $203,000 After 25 years............ $290,189
After 5 years......... $215,456 After 30 years............ $312,616
After 10 years...... $232,108 After 35 years............ $336,776
After 15 years...... $250,046 After 40 years............ $362,803
After 20 year........ $269,371 . . . and so on . . .
What if my income or household size changes after I move into my new home?
No problem. As long as you pay your mortgage, your taxes, insurance and ground lease fee, your home is yours. Even if you make more or less money, add or lose household members, your home is yours. We understand that life is full of change.
What do you consider a household?
THLT views your household as anyone residing in your home. This could be a single individual, roommates, spouse, boyfriend, girlfriend, friend, grandparent, children/dependents or other relatives. You do not have to be related or married. It is the people you choose to reside with and we welcome all configurations of households.
That said, when we count your household size for program eligibility, we use HUD's definition. This does not include foster children, live-in aides, children of live-in aides, un-born children, children being pursued for legal custody who are not currently living in the household, and children who are subject to a shared-custody agreement in which a child resides in the
household less than 50% of the time.
Do you work with real estate agents?
Do I need to be living in Thurston County to qualify?
Yes. You must be living or working in Thurston County.
How do property taxes work with a THLT home?
Just like any homeowner, you pay 100% of the taxes on the home and land.
How and when are my property taxes paid?
As with any home, your property taxes will be paid to your lender each month when you make your mortgage payment. The lender collects and deposits your property taxes in a special escrow account, and pays the property taxes directly to the County on your behalf in April and October of each year. The only instances where you will pay the property taxes directly to the County yourself are after you pay off your mortgage in full.