May 16, 2021

MP Now News

Mortgage News

With Marcia Fudge at HUD, opportunity awaits for minority homebuyers

If you survey the average American, you will find that home ownership ranks among the top performers when asked about the principles of the “American Dream”.

In fact, the National Association of Realtors’ annual poll keeps coming to an end nine in 10 Homeowners see home ownership as part of realizing their personal American dream. And recent studies found that 71% of millennials between the ages of 18 and 34 perceived home ownership as part of their property American dream, also.

Unfortunately for far too many people – especially minorities – this dream is still out of reach.

Today’s home ownership rates show astonishing differences: while almost 67% of all Americans own houses; only 44% of black families own houses, compared with 73% of white families. Worse still, black home ownership is the same today as it was in 1968, when the Fair Housing Act was first passed. As a country, in the decades since the anti-discrimination law was passed, we have made little progress in improving minority access to home ownership.

To some, the American dream may seem far from reality.

However, it can be light at the end of the tunnel. The endorsement of US Secretary of State for Housing and Urban Development Marcia Fudge provides an opportunity to restore America’s home ownership legacy that has long been out of reach for our color communities.

With a new perspective and a new approach to expanding housing options to all Americans, Fudge be committed Prioritize equality when buying a home. From her early days as mayor of a small Ohio town, Fudge began grappling with the affordability and availability of housing – and she didn’t stop as a member of the U.S. House of Representatives, which represented the Ohio 11th Circle. Given her years of experience and her current post at the helm of the HUD, I hope she will have a lasting and positive impact on this critical government agency and the millions of households she serves.

Fudge - HUD.jpg

“We need to make the dream of home ownership – and the creation of security and wealth that goes with it – a reality for more Americans,” said HUD Secretary Marcia Fudge. “To do this, we have to end discriminatory practices in the real estate market.” Bloomberg News

And there couldn’t be a better time for someone with Fudge’s experience to take the reins. Today’s consumers represent a new generation of homebuyers who are moving from renting to owning. The profile of the new homeowner will be largely made up of minority groups, mostly Hispanic, Black, and Asians. However, among all buyers Down payments remain the main obstacle to home ownership – especially for minorities.

Overall, the BIPOC community lacks that Intergenerational prosperity required to pay our own deposit. For this reason, down payment support programs are critical to properly closing the home ownership void. Without DPA programs to bridge this gap, we run the risk of deepening these racial differences further.

In 2020, more than 40% of all purchase transactions were made by the Federal Housing Administration in any form the deposit assistance. These data reflect the needs and diversity of the millennial generation moving into home ownership. Since our inception, CBC Mortgage Agency has helped tens of thousands of borrowers across the country with their down payment assistance through the Chenoa Fund program. In 2020, 55% of our borrowers were minority groups, with 75% representing the first generation in their family to ever own a home.

And contrary to some opinions, the FHA grants loans to the data protection authority from a government agency perform better as loans from family members, including families with intergenerational wealth. And therefore we are proud. We are committed to ensuring that our borrowers successfully move into sustainable home ownership.

The Chenoa Fund program complements other DPA programs by serving a broad audience of consumers, promoting a healthy, competitive mortgage market, and introducing innovative financial products. Unlike other DPA providers who have different rules and requirements from state to state, CBCMA uniquely offers a unified set of underwriting guidelines to serve our customers across the country.

We are doing our part, but much more can be done – and now the time has come. After decades of promises by government leaders, we haven’t made any meaningful changes to home ownership rates for minorities – especially black Americans. It is imperative that the HUD protect the DPA programs, create a national model, and find ways to improve the coherence of federal programs. We believe Fudge is the right person at the right time.

It is time the American dream became a reality for all Americans.