Patience Needed for Housing Loan Program, Home Buyer Finds

 The sheer mass of real estate available at a record-low price combined with a no-interest loan from the government and an $8,000 income tax credit for first-time buyers quickly persuaded 30-year-old Lisa Locascio to make the leap into home ownership.

It wasn't as easy as she thought it would be, even for someone determined to buy her first home.

Locascio's Realtor and long-time friend, Lance Connolly, started compiling foreclosure listings more than three months ago, as soon as Locascio was approved for a $15,000 down-payment loan through the federally funded Neighborhood Stabilization Program.

The loan program is aimed at helping would-be home buyers stabilize distressed neighborhoods while also helping banks unload foreclosures. The rules seem straightforward. The Phoenix program offers up to $15,000 in financial assistance toward a down payment or closing costs to approved applicants who are, in turn, required to provide $1,000 of their own funds toward the purchase of a foreclosed property at 1 percent below appraisal value. The loan has to be repaid when the home buyer sells or refinances.