Town offers to pay off your student debt

[teller80]

A town in Ohio is introducing legislation offering to pay off half of your student loan debt, up to $50,000, if you buy a house there. You must stay 10 years to get 80% and 15 to get 100%. This article doesn't say it, but I heard on the radio that they expect the tax base to grow enough to pay for the program.

I think it's an interesting concept, what do you all think?

Link

 

[Christine]

It's a great idea as long as they also have the jobs available so that the person can afford to get the mortgage and pay the house payments. I feel like if you have to make a deal to get people to move to your area, jobs might be scarce.

 

[HopperFan]

Always a catch ...

 

[a1tinkfans]

Have you looked at the stats? The incomes are very low, on a downward trend.
The home values are low, also on a downward trend.
There is no enticement imho. I think the Mayor is trying to think outside the box, kudos. However, I’m not seeing it successful if it passes and comes to fruition.

 

[barkley]

how very northern exposure (except in that case it was that joel had to work for the town).

 

[Kitty 34]

Makes you wonder how the town can afford to do this? Nice idea, tho.

 

[disykat]

It would pretty much have to start with people who work from home. Then as more people move in, service related employment would increase.

I think it's a great idea if they can get enough people to "bite" to jumpstart it.

Nevermind, it's actually a good commute from Cleveland. Makes you wonder why they have to work so hard.

 

[design_mom]

What town is it? (I saw something about Hamilton, but it's a commutable distance from Cincinnati, so I don't think it would have too much trouble attracting people.)

 

[disykat]

I googled and the first entry was from a few days ago about Newburgh Heights having the offer OP wrote about. It looked like it was 15 miles from Cleveland. Now I see the other offer from earlier about Hamilton, which says it's 45 minutes from Cincinnati and is offering 5K.

 

[Colleen27]

Our county has a "reverse scholarship" that is somewhat similar, but targeted mainly toward people who grew up/graduated from high school here and moved away for/after college. The idea is to lure them back to spend their settling down/raising a family years in this area to try to halt a long trend of population loss. IIRC, the max benefit is 10K.

 

[Colleen27]

Have you looked at the stats? The incomes are very low, on a downward trend.
The home values are low, also on a downward trend.
There is no enticement imho. I think the Mayor is trying to think outside the box, kudos. However, I’m not seeing it successful if it passes and comes to fruition.

And the terms aren't exactly great - short sales, foreclosures, etc. don't qualify, so you'd likely have to pass up the best deals in the local housing market to get the incentive. That might be worth it if your debt was high enough to get the whole $50K, but for someone with the average $35K in debt who will only see a $17K benefit, not so much.

 

[soccerdad72]

I heard something on the news the other day about this, but didn't stay up to catch the 11pm news to see what suburb it was.

If it's Newburgh Heights - they'll never draw any people. It's a dinky little crappy suburb just outside of downtown Cleveland who's primary source of income is speeding tickets on their 1 mile stretch of highway.

 

[barkley]

i just don't see how this would be structured. will the city pay the initial entitlement in a lump sum at the close of escrow? if it's some kind of over time payments or payments in the form of a tax credit i think it's risky to trust that the city will have the funds it's promising to pay. student loans are unique loans in that they can't be discharged through a bankruptcy so i wouldn't be willing to buy into a program like this unless the money the city was going to pay was set up during the purchase process of the house in a special escrow so that the closing of the home purchase and the payment to the student loan lender coincided so that neither could occur without the other.

as a seller i would be hesitant to deal with a sale that was contingent on the city paying off someone's existing debt so that they could qualify to buy my home (i worked for government long enough to know how easy it is for paperwork to get messed up and payments delayed so i could see closings getting delayed and that toggling on to a sellers closing on their next home and so on and so on....).

 

[ronandannette]

It's a great idea as long as they also have the jobs available so that the person can afford to get the mortgage and pay the house payments. I feel like if you have to make a deal to get people to move to your area, jobs might be scarce.

There are many, many small municipalities in Canada that will give away residential lots to people willing to build a home and live in the communities. There’s certainly no “land rush” on though as the pesky problem of how to actually make a living in those areas remains.

There are also opportunities for anyone wanting to become a doctor (or immigrant medical professionals that want to become certified in Canada) to get a full-ride from the government. They must then be willing to be posted to some remote northern place for the duration of a very long contract. Potential candidates are not clamoring for this program either. That lifestyle is practically intolerable for many.

 

[Hikergirl]

A town in Ohio is introducing legislation offering to pay off half of your student loan debt, up to $50,000, if you buy a house there. You must stay 10 years to get 80% and 15 to get 100%. This article doesn't say it, but I heard on the radio that they expect the tax base to grow enough to pay for the program.

I think it's an interesting concept, what do you all think?

Link

It is interesting, and I don't really know enough about the town to have an opinion on whether it is a good thing or not.
I'm pretty cynical when it comes to things like this though.
Whenever these towns claim that the new tax base will cover some great new program, my first thoughts are always- for how long? How long before that "newfound money" is used elsewhere and then, surprise, they don't have the money to cover the program it was intended for?

 

[Lilacs4Me]

It would pretty much have to start with people who work from home. Then as more people move in, service related employment would increase.

I think it's a great idea if they can get enough people to "bite" to jumpstart it.

Nevermind, it's actually a good commute from Cleveland. Makes you wonder why they have to work so hard.

I would do it in a second (if it was a decent area, and school districts will be a consideration for the next 5 years, at least). And yes, I work from home, for a Fortune 500 company that is not based in the Midwest. My department/position is remote, so I can live anywhere I can get a fast and reliable internet connection.

 

[barkley]

There’s certainly no “land rush” on though as the pesky problem of how to actually make a living in those areas remains.

babysitting for bacon????

i could'nt resist. i just learned this term on a recent vacation to canada when i inquired of one the locals in a remote area about what type of employment the year round residents did (b/c the commute to the nearest reasonably sized city would have been insane and dangerous once the first snow hit). i got an education on how to survive on minimal internet income balanced w/bartering (aka 'babysitting for bacon').

 

[a1tinkfans]

I would do it in a second (if it was a decent area, and school districts will be a consideration for the next 5 years, at least). And yes, I work from home, for a Fortune 500 company that is not based in the Midwest. My department/position is remote, so I can live anywhere I can get a fast and reliable internet connection.

Imho..A huge part of “living” is the part outside of working. What there is to do, participate in etc. those evenings and weekends when ur thankfully/hopefully not working. Lifestyle... activities etc.

you can easily get the info u mentioned online ..as the stats ( which are sadly dismal) are likely Very in tune with the areas “vibe”.
It reminds me of researching for our retirement locale.
It certainly would be awesome if an opportunity like this worked out for people/you.

 

[Boardwalk Jedi]

I've seen lower interest rates offered if buying in a certain city/town. Not sure how it works, but I'll give this mayor credit. Hope it works.

 

[Colleen27]

I would do it in a second (if it was a decent area, and school districts will be a consideration for the next 5 years, at least). And yes, I work from home, for a Fortune 500 company that is not based in the Midwest. My department/position is remote, so I can live anywhere I can get a fast and reliable internet connection.

I would too, if school district/quality wasn't a consideration. My current position isn't remote but my career lends itself to working remotely so for the right location I'd make the jump, and I'm hoping to make a big move in 3-4 years, when my youngest "graduates" from her private K-8 school and will be joining an entirely new peer group no matter where she attends high school.

Imho..A huge part of “living” is the part outside of working. What there is to do, participate in etc. those evenings and weekends when ur thankfully/hopefully not working. Lifestyle... activities etc.

you can easily get the info u mentioned online ..as the stats ( which are sadly dismal) are likely Very in tune with the areas “vibe”.
It reminds me of researching for our retirement locale.
It certainly would be awesome if an opportunity like this worked out for people/you.

That would absolutely be a concern about a remote area, but neither of the two Ohio towns are especially isolated. Going into the city for nightlife, or to more upmarket suburbs for shopping, or out into rural areas for recreation are all reasonable options from both of the places that were named on this thread. That's the main reason I could see it working, if the city follows through - because IME it doesn't take a whole lot of incentive to start turning an aging, low-rent inner ring suburb into an enclave for hipsters and millennials who want urban proximity but can't afford the price tag due to student loans. But I remain skeptical about the offer excluding vacant housing stock. You would think that would be the lowest-hanging fruit for a residential incentive - turning the lowest-priced and most likely to become blighted properties into owner-occupied residences.