BANGOR, Maine — A local couple who last month faced the sobering possibility of losing their home has reached an agreement with the city of Bangor to repay more than $100,000 in outstanding loans and back taxes.
The workout agreement between Jennifer and Peter Brown and the city has a number of caveats but essentially requires the Browns to pay $800 a month and keep open a constant line of communication.
“If it works, it’s great because we’ve allowed people to stay in their home. We want them to succeed,” said city finance director Debbie Cyr, who helped craft the workout agreement.
Added Councilor Rick Bronson, who is chairman of the finance committee that approved the agreement this week: “I’m convinced that there are enough safeguards to protect the city going forward. At least we’ll be better protected than we have been to date. The city has been really slow in reacting to this.”
Attempts to reach the Browns this week were not successful.
About one month ago, Jennifer Brown appeared before the finance committee to address her debts. She and her husband live at 110 Pearl St. in a home that has been in Peter Brown’s family for years.
The two-story dwelling was in bad shape when the couple took over possession in 2005. They needed money to renovate the home but banks wouldn’t help. That’s where the city came in.
Under a program offered to low-income residents through Bangor’s Economic and Community Development Department, the couple received a low-interest loan of $70,000. The loans, which are for terms of up to 20 years at 3 percent financing, are meant to make improvements to homes in the areas of safety and energy effi-ciency and to prevent further deterioration.
Since 2005, the Browns have received two subsequent smaller loans from the city and in all, owe about $110,000, including back taxes.
From 2005 to 2007, payments were sporadic. Sometimes they came every week. Other times, the Browns would go months without paying on the loans. The last payment to the city came in 2007.
Councilors agreed city officials showed extreme patience in dealing with the Browns’ delinquency. They sent certified letters. They tried making contact by telephone. But the Browns could not be reached.
The city was left with two options: foreclosure or repossession. Taking possession of a single-occupancy dwelling happens rarely in Bangor. The city might repossess a home that has been abandoned, but it almost never happens when the home is occupied.
At last month’s meeting, councilors were clearly uncomfortable making a decision that would have forced the couple from their home.
Bronson said this week’s decision was not any easier.
“The difficulty is that they have been given all the second chances they have. This is it,” Bronson said this week. “I hope it works out for them, but if it doesn’t, I suspect [the council] is going to be willing to lower the boom. I think it’s fair to say we got their attention.”
The case of the Browns shed light on the city’s rehabilitation loan program, a pool of federal money that is offered to low-income residents through the Economic and Community Development Department.
Economic Development director Rod McKay said the little-known program dates back to the 1970s and has been largely successful.
“I’m a little surprised we’ve done as well as we have,” McKay said. “These are people who likely would not have gotten loans anywhere else.”
Bronson said the program makes him a little uncomfortable, but agreed that it probably is a necessary evil.
“Because it’s federal money, we probably will never turn it down, but we could probably do a better job administering it,” Bronson said. “There are people out there that say we ought not to be in the loan business because we’re not good bankers. That’s probably true, but if we stopped administering these programs, that would be a detriment as well.”