Little Egg residents learn of financing options in wake of Sandy
LITTLE EGG HARBOR TOWNSHIP — As township properties continue to be vacated post-Hurricane Sandy, a local attorney, mortgage brokers and real estate agents want the public to know there are financing options to rebuild and come home.
A seminar was held Monday at Sea Oaks Golf Club to discuss financing options and answer legal questions about rebuilding after the storm.
Officials have so far identified more than 150 township homes that appear to be abandoned since Hurricane Sandy and are being assessed by the township and the Federal Emergency Management Agency to determine if they will be demolished.
About 4,000 of the township’s homes have suffered substantial damage due to Sandy. According to the 2010 U.S. Census data, there were 10,324 housing units in the township with 8,060 of them occupied.
Attorney Richard Kitrick, a township resident who handles many local real estate transactions, told a crowd of real estate agents and residents Monday afternoon that the small slab-style homes in the Mystic Island section of the township make the community one of the hardest to rebuild in.
“There are plenty of people who want go back into these houses because they watched the water come up and destroy everything in their home. The goal isn’t to keep them in the same old Mystic Island homes. The goal is to get them to raise or demolish them and rebuild new properties,” he said.
Edward Andrew, a resident of the Osborn Island section of the township, said at the seminar he has seen many people walk away from their homes since the Oct. 29 storm because they are scared and have no answers.
“But also it’s because no matter how much they can borrow, many of them still can’t afford to do it,” Andrew said.
Monday’s discussion centered on financing the rebuilding process. A few of those options include loan programs such as the FHA 203H, FHA 203K, Homepath Renovation, Homestyle Renovation and reverse mortgages.
Homeowners basically have four options moving forward: repair the home and leave it at its current elevation, head for dryer land and sell to the property, demolish and rebuild to bring up to current elevation requirements, or walk away.
Frank Montufar, of Acre Mortgage, said the homeowners who find themselves in the most difficult situation are those who are upside down on their mortgage, have recently purchased a property or have refinanced and taken out the equity.
“We’re trying to avoid foreclosures. We’re trying to get people back into their homes. These homes could be destroyed, and this is critical for the future of the town. They’re scared because the information isn’t coming out quick enough and most of it isn’t correct,” Montufar said.
Vincent Simonelli, president of Dream Homes, Ltd. Forked River, reminded the group on Monday that raising a home on a slab in the Mystic Island section is difficult and expensive.
“If a home is older than 15 years, the owner should really consider demolishing and rebuilding because the changes and advancements in building codes protect more during a hurricane event. The energy values of new homes are also substantially improved because of changes in the codes,” Simonelli said.
In Little Egg Harbor, there’s a market out there for people who have cash on hand because of the fire-sale-like pricing of the homes and empty lots because of storm damage, Kitrick told the crowd.
Chuck Reed, a mortgage planner with Acre Mortgage in Galloway Township, said many people are unaware of the mortgage options that are out there to help with rebuilding.
Many homes are listed tens of thousands of dollars below what they would have been one year ago, Reed said.
Reed said one of the Federal Housing Administration’s programs is the 203H mortgage. It is specifically designed for homeowners and renters who were displaced by the hurricane.
“This offers 100 percent FHA financing and is not restricted to disaster areas to purchase new homes,” Reed said.
The program allows the FHA to insure mortgages made by qualified lenders to victims of a major disaster who have lost their homes and are in the process of rebuilding or buying another home, according to the FHA website.
“Unfortunately, I haven’t seen many people who are going to be able to rebuild, because they don’t have the money. Homeowners are getting enough money to repair what is there, but not enough to rebuild,” Kitrick said.
Coldwell Banker Red Top Realty real estate agent Lynn Hansen said potential customers and homeowners, along with herself, remain confused about rebuilding and the financing that is available.
“It’s all still kind of fuzzy to me. It has been four months and the insurance money is supposed to be coming soon. People don’t know exactly the right thing to do and probably never will,” Hansen said.
As far as potential customers, Hansen said, some investors are looking for cheap waterfront houses, but after the listings are forwarded to them nothing happens.
“The investors I have talked to want to buy these cheap houses, fix them up and rent them out, but they should be probably be thinking about knocking them down and rebuilding,” she said.
Hansen also attended the seminar Monday afternoon to collect information as she deals with her own storm damage at her Beach Drive home in the Osborn Island section.
Hurricane Sandy pushed 2 feet of water inside her home, which sits across from the bay, and her yard was under 5 feet of water, she said.
“I don’t really have an option other than to repair because it’s not going to be knocked down. We don’t have enough damage to knock it down, and then the only question left is about elevating. I’d like to know when is that going to be final?” she said.
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