Our Commitment to Increasing Access to Homeownership

Our Commitment to Increasing Access to Homeownership

Owning a home is often referred to as part of the “American Dream,” but it’s about more than finally having a house with a white picket fence. Homeownership has many other benefits:

Homeownership is a Building Block to Financial Wellness

When an individual can own their own home, it sets the stage for future financial success. Instead of paying monthly rent payments that will never be seen again, monthly mortgage payments build equity. As property values increase over time, so does the equity in the home. Over time, this equity can significantly add up, creating wealth that can be passed down from generation to generation.

Homeownership Revitalizes and Strengthens Communities

When one owns their own home, they tend to do so with a sense of pride. As a result, homeowners maintain their property more so than a renter might. Lawns are watered and mowed, necessary repairs are made, and the general curb appeal is maintained. This upkeep is contagious to neighbors (i.e. keeping up the Joneses) and helps keep the neighborhood and/or entire community thriving.

Likewise, homeowners who can start building wealth are more apt to spend money in their communities on the things they want and need in life. This increased spending helps fuel the local economy and strengthens the community.

The American Dream is also the belief that anyone, regardless of where they were born or what class they were born into, can attain their own version of success in a society where upward mobility is possible for everyone. The American Dream is achieved through sacrifice, risk-taking and hard work, not by chance.

Unfortunately for many, barriers exist that prevent homeownership from ever becoming a reality. These barriers include lack of credit or poor credit history, lack of income or savings for a down payment, and uncertainty about the process of purchasing a home. These factors also contribute to the large unbanked and underbanked population in the US. According to the Federal Reserve, 22 percent of the US population is either unbanked or underbanked. These individuals are more likely to be a racial or ethnic minority and have lower incomes.

At FNBO, we work to break down barriers to homeownership by providing loans and community investments to historically underrepresented populations. In 2020 alone we financed:

• $17.2 million in impact investments to increase access to affordable housing and improve disinvested neighborhoods, bringing FNBO’s total outstanding investments in this category to $218 million;
• $336 million in community development loans for affordable housing or commercial development in low- to moderate-income neighborhoods;
• $82 million in VA mortgages and $460 million in mortgages to first-time homebuyers;
• $508 million in mortgages for low- and moderate-income individuals and $263 million in loans for racial minority populations; and
• $313 million in mortgages in low- and moderate-income neighborhoods and $154 million in loans in majority-minority neighborhoods.

Additionally, we supported community organizations with more than $1.35 million in grants and donations to increase access to affordable housing for our neighbors and improve their neighborhoods.

Collectively, these investments made by FNBO in 2020 yielded the following impacts:

• 2,032 affordable housing units were made available;
• 3,524 homes were financed for low- and moderate-income families and 1,468 homes for racially minority families;
• 1,685 homes were financed in low-and moderate-income neighborhoods and 510 homes in majority -minority neighborhoods;
• 1,594 families purchased their first home; and
• 322 veterans now own a home.

Many of these impacts would not be possible without our nonprofit partners who help individuals improve their credit worthiness and knowledge of the banking system through credit counseling and financial education services. These services provide individuals with the direct assistance and personal coaching necessary to build or improve credit as well as saving, spending, and money management skills.

Credit Advisors Foundation (CAF), in Omaha, Nebraska, is just one of the community organizations FNBO partners with to help increase access to homeownership.  Since 2016, we’ve supported CAF with more than $150,000 in grants which provided more than 2,600 individuals with credit counseling services. CAF is a HUD-approved agency that provides housing programs to assist individuals with housing counseling and education needs in order to help them purchase their first home, make their dream home a reality, or to re-enter the housing market after mortgage challenges.

Pre-Purchase Homebuyer Education and Counseling

CAF’s Pre-Purchase Programs assist borrowers looking to purchase a home. Some may be current homeowners looking to either upgrade or downsize, while others are first time homebuyers interested in understanding the entire homebuying experience, from saving for a down payment to loan closing. Homebuyers learn terminology involved with real estate purchases, how to better understand paperwork and loan documents, to recognize their rights and responsibilities during the purchase process, and about the ongoing homeownership experience.

Post-Purchase Homebuyer Education and Counseling

CAF’s Post-Purchase Programs are divided into non-delinquency and delinquency issues. These services help homeowners address changing circumstances in their household’s financial situation.

The Home Maintenance and Financial Management for Homeowners Program addresses home maintenance issues and helps to lower homeownership costs and expenses. Financial management assists homeowners with issues and challenges related to non-mortgage credit and debt management, allowing for ongoing stability in the housing situation.

CFA can help those having trouble making their mortgage payments and work to resolve the problem with their lender through the Mortgage Delinquency and Foreclosure Mitigation Program. Housing counselors assist clients who are facing foreclosure by seeking resolution through repayment plans, loan modifications, or other available options. CAF also helps delinquent homeowners understand their rights and responsibilities during the resolution process.

For more information on Credit Advisors Foundation’s Homeownership programs, click here.