Why would a “non-profit” want to buy a Carmel Valley House?

[enron_by_the_sea]

I don’t know how many people saw this video posted on Jim-the-realtor’s site.

CV REO Traffic

Short summary: A REO pops up in Carmel Valley. From the outside it looks like a nice typical CV house. Jim thinks he is getting to list it. Then “non-profit” called “National Community Stabilization Trust” pops up. Apparently they get first dibs on a property.

– Why does “National Community Stabilization Fund” want to acquire a $599,000 REO property in Carmel Valley bypassing the market? This area is not clearly anywhere close to “distress”

– I sense that there is a scam going on here. How does it work?

[CA renter]

Not sure if it’s a “private” scam or a “public” scam, but it seems to use taxpayer money, along with “philanthropic” money, support purchases of properties around the country.

“How the REO Capital Fund Works
Access More Financing, Acquire More Homes, Achieve Greater Neighborhood Impact

To increase access to capital for community based borrowers, the REO Capital Fund leverages public and philanthropic dollars with senior debt provided by private lenders. Through a program related investment from the Ford Foundation, the REO Capital Fund is able to achieve a credit enhancement structure that enables it’s participating CDFIs to offer more flexible loan parameters to community based borrowers than otherwise available in today’s market.

Many municipalities and community-based organizations rely on Neighborhood Stabilization Program funds (NSP) for their stabilization efforts. The REO Capital Fund is designed to maximize the impact of the limited public resources and has been specifically structured to complement the needs of local housing providers using these federal funds. Community based borrowers can use the REO Capital Fund to leverage NSP or other existing funding and dramatically increase the number of properties acquired and renovated in target neighborhoods without sole reliance on the recycling of program income.”

http://www.stabilizationtrust.com/programs_services/reo_capital_fund/
——————

Good to know our tax dollars are going to such noble purposes [sarcasm, in case anybody doesn’t get it].

“Credit enhancements” that allow for “more flexible loan parameters” sounds like monkey-speak for the same sort of $hit that caused the “financial crisis” in the first place.

This is disgusting.

[jimklinge]

There are a couple of other examples too.

1. We all remember the million-dollar TERI house in Bressi Ranch, bought with $795,000 from the City of Carlsbad to house a handful of disabled adults.

2. There is one on the table currently with the Carlsbad city council to blow another $1,000,000+ to purchase a medical condo on CV Drive across from city hall. They want to set up a shop for welfare recipients, and use taxpayer money to fund it.

I have no problem with the city/state/fed gov helping disabled/welfare folks. In fact, I am all for it.

But why do they need such swanky upscale real estate?

It’s because the brokers are pushing it as the only alternative.

I was asked to find other options for the welfare office, and within minutes provided two solid choices off the MLS around the downtown Carlsbad area, priced at $650,000 and $795,000.

[Author]

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