First-time homebuyers in the New Haven area now have a new source of financial support.
The Greater New Haven NAACP, in partnership with the Community Foundation for Greater New Haven and Neighborhood Housing Services of New Haven, last Wednesday launched the “Homeownership Matters,” which provides $10,000 in interest-free forgivable loans to low- and medium-income urban homebuyers in the New Haven area. According to the group’s president, Doris Dumas, the program contributes to the NAACP’s broader mission of leveling the playing field and opening doors for continual advancement.
“In the city and throughout our region, black and Latino households are less likely to own their own homes,” Dumas said.
Citing recent census data, Dumas said that in many of the city’s neighborhoods, fewer than one in four households own their homes. In New Haven, she added, only 27 percent of black households and 18 percent of Latino households own their homes — compared to 37 percent of white households.
The loans, which can go toward down payments and closing costs, are fully forgivable five years after the closing date if the buyer lives in the home for the duration of the loan.
To be eligible for the program, families must have an income at or below the federal Department of Housing and Urban Development’s median income level for New Haven, and buyers need to be purchasing a one- to four-family home in New Haven county, according to Bridgette Russell, managing director for the HomeOwnership Center at Neighborhood Housing Services and housing chair of the NAACP.
Through its lending department, Neighborhood Housing Services will administer the program and assist with paperwork for mortgages and on determining household eligibility, Russell said.
“We want a program that’s going to be successful and we want homebuyers to be successful,” Russell said.
More than half of the city’s households — 52 percent — are cost burdened, meaning that more than 30 percent of their income goes toward housing costs like rent and mortgages, Dumas said. 29 percent of the city’s households are severely cost burdened, meaning that more than half their income goes toward housing costs.
Homeownership can help ease the burden, Dumas said, since households can often acquire mortgages at rates less expensive than what they would pay to rent a similar property.
“We know that if more people were to own homes, it would revitalize our communities, insert pride and also trickle down to other things like education,” Dumas said.
The loan can be combined with employer- and city-assisted programs such as the Livable City Initiative in New Haven, and similar programs in West Haven and Hamden, Russell said. Homebuyers are able to select their mortgage from several lenders.
The Community Foundation holds the $1 million that were originally allocated to the program by First Niagara Bank, now KeyBank. The foundation believes that homeownership rates remain too low in New Haven, especially among people of color, Community Foundation Communications Officer Ratasha Smith said.
“Homeownership can create a pathway for low- and moderate-income families to build wealth and security and stabilize neighborhoods,” Smith said.
Sharleen Sanchez Barriera, a participant in the initiative, said the program was helpful since, despite her savings, she had not been able to afford the down payment on her house. She described the process as “pretty smooth,” especially with help from Neighborhood Housing Services.
Another participant, Ade Nicholson-Hassell, hopes to close on her house in New Haven later this month, along with her husband and six other family members.
Nicholson-Hassell, who also works as a clinical receptionist at the Yale School of Medicine, was able to combine the NAACP program with Yale’s first-time homebuyer initiative. Participants in the NAACP program are required to complete a class on homeownership, and Nicholson-Hassell said she appreciated being walked through every step of the homeownership process.
“[The program] is a great help to middle-class working families,” Nicholson-Hassell said.
The NAACP and Neighborhood Housing Services will hold an information session on Feb. 24 at ConnCAT in Science Park.
Brandon Chambers | firstname.lastname@example.org