how is KulshanCLT different than other affordable homeownership programs?
KulshanCLT has operated by the ‘pay it forward’ model since our founding in 1999. In exchange for the significant down payment assistance that KulshanCLT provides, you agree to pass on the good deal to the next eligible buyer. KulshanCLT’s resources reduce your home price by $50,000 to $100,000 compared to houses on the same block. The “investment” just keeps giving when or if you choose to sell your home; it is not a loan that you would be responsible to repay (as long as you sell your home to another income-qualified family). You earn a reasonable amount of equity during the time you own your home with an incremental increase in value, plus you pay off the principle of your mortgage, but without pricing another family out of the home.
who buys with KulshanCLT?
KulshanCLT 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, nonprofit employees and more.
The people who purchase homes through KulshanCLT’s program are done renting and ready to be homeowners, but they can’t afford to buy a home on their own. KulshanCLT can help you buy a home in good condition near jobs and services, transportation options and quality schools.
what is my home loan like?
With a CLT loan, there are no mortgage insurance payments, no balloon payments, no short terms, no fluctuating interest rates–only 30-year fixed-rate conventional mortgages.
We are very firm on serving families well and honestly. We steer homebuyers away from predatory lending practices and educate you on affordable options, providing educational support before and after you buy. As a buyer, your options become informed decisions about your next big step.
what if my credit or debt is not the greatest?
Together with our preferred lenders, we can counsel you on how to get on track for homeownership. We have individuals walk through our doors who get into their new home anywhere from two months to two years later. Preparing to own a home is a process, and we’re here to make it doable, easier and understandable.
what are my down payment options?
Typically our program requires that you put down a minimum cash contribution of 1.5% of your purchase price, or $2,500, whichever is greater. You are welcome to put down more cash if you are able.
what is a community land trust?
Community Land Trusts (CLTs) are nonprofit organizations that help make homes and other things (such as community gardens, commercial space, affordable 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. Read more in About Community Land Trusts.
do I own the land?
Yes and No. KulshanCLT technically retains ownership of the land in order to ensure that the house remains affordable, but you become part of KulshanCLT so you, as part of KulshanCLT, own the land.
Let’s clarify this point:
The ground lease agreement is a key document that ties the land and the house together and is the most legally enforceable way to ensure that the program requirements are adhered to. This document brings together the pay-it-forward model, allowing the affordability of the home to be kept for the community, securing you modest equity when you sell, and keeping the purchase assistance with the home so it may be passed on to the next buyers.
Most importantly, you are responsible for the land and have the right to landscape and do all normal homeowner things. This is your place—you get to enjoy all the security, control, tax advantages, and equity building opportunities of homeownership. See our Information Packet or to go even deeper, our Homebuyer Manual.
can I leave my home for 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 live 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 only a nominal $45 monthly ground lease fee to support us organizationally and continue our nonprofit’s work.
does KulshanCLT share the equity I gain?
Nope, the 1.5% yearly equity is all yours.
In exchange for the $50,000 to $100,000 to reduce the price of the home, you agree to sell your home at an affordable price (should you decide to sell), allowing another individual or family to achieve their dream of homeownership as well.
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 principle is paid down.
Together, these two factors enable you to build equity throughout your period of homeownership.
- The KulshanCLT home appreciation rate is 1.5% interest annually, for every year you own your home.
- You can also 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.
- If you damage the home or damage is caused by deferred maintenance then you may not be able to receive the full formula price when you’re ready to sell.
what about selling my home?
You can sell your home to any income-qualified homebuyer. KulshanCLT helps families most of the time in selling their home, but you’re 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 + downpayment – closing costs) and grows by 1.5% 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
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 brings all sorts of things. Changes to income or household size won’t affect your eligibility for your KulshanCLT home or your house payment once you’re in your new place.
do I need to be living in Whatcom County to qualify?
With KulshanCLT, you typically need to live or work in Whatcom County for 12 months before you can purchase a home with us. If you are joining our community under other circumstances, let us know and we can evaluate your specific situation.
how do property taxes work with KulshanCLT homes?
Just like any homeowner, you pay 100% of the taxes on the home and land.
how and when are my property taxes paid?
For most financed homes, your property taxes will most always 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. In most cases, our program requires that you pay your property taxes through your lender via an escrow account.
The only instances where you will pay the property taxes directly to the county yourself are after you pay off your mortgage in full.