Models & Resources Supporting Native Homeownership, Homebuyer Education Overview

1. Models & Resources Supporting Native Homeownership, Homebuyer Education Overview November 18, 2013

2. Presentation Overview • Coalition survey results regarding homebuyer education • Types of homebuyer education • Resources for homebuyer education

3. Coalition Survey results

4. Survey Methodology • Online survey sent in June 2013 to 73 stakeholders including: • Tribal leaders, • Tribally designated housing entities, • State and federal representatives, • Lenders and Native CDFIs, • Nonprofits, and others • 42% response rate

5. Obstacles to homeownership in Native communities • Homebuyer readiness of clients (70%) • Infrastructure delays (66.7%) • Lack of local lenders (60%) • Lack of housing inventory (60%) • Hard to get construction financing (46.7) • Hard to access land (43.3%)

6. Top three obstacles to homebuyer readiness

7. Top things Native homebuyers want to know more about

8. How tribes can support homeownership

9. Types of homebuyer education

10. Discussion Question What types of homebuyer education do you provide?

11. Homebuyer Education Classes Pros Cons Difficult to get families to attend Need instructors who understand home buying process • Provides overview of home buying process • Helps client understand affordability • Improves client’s ability to maintain a home • Provides guidance on how to manage a mortgage

12. One-on-one Homebuyer Counseling Pros Cons Not as cost effective as group classes Takes more staff time to deliver • Provides clients help with each of their individual situations • Helps client to navigate through the home buying process • Keeps client engaged in the process

13. Credit Counseling Pros Cons Some clients may not feel comfortable discussing financial their financial situation with counselors Takes a long time Must be delivered by trained personnel • Helps clients to manage their credit more effectively • Provides client with a plan to improve credit score • Helps clients get out of financial troubles • Improves loan product options and terms

14. Financial/Credit Coaching Pros Cons Expensive to administer Clients may not understand what coaching is Takes strong commitment from clients • Helps clients reach self-directed goals • Customized to each client • Client-paced • Provides accountability • Addresses behavioral economics

15. Basic Financial Education Pros Cons Difficult to get clients’ attention until they are in trouble Must have trained personnel • Helps clients learn basic banking skills • Provides foundational knowledge • Explains the basics of managing credit

16. Individual Development Accounts Pros Cons Expensive program to administer Difficult to find flexible match funds and operating funds • Establishes savings habits • Helps clients prepare for homeownership • Matched savings for mortgage downpayment

17. Homebuyer education resources

18. HUD Funding Sources ONAP Programs • NAHASDA Indian Housing Block Grant (IHBG) • Administered by Tribe or TDHE • Indian Community Development Block Grant (ICDBG) • Competitive by ONAP region “Big” HUD Programs • Resident Opportunity Self Sufficiency (ROSS) grants • Comprehensive Housing Counseling Grant • Must be HUD Approved Housing Counseling Agency • Neighborhood Stabilization Program

19. Rural Development Funding Sources • 502 Loan Packaging • Provides staff training • Rural Community Development Initiative (RCDI) • Matches funding of an intermediary to provide homebuyer education

20. SDHDA Administered Sources • HOME – for homeownership development subsidies • Homeownership Education Resource Organization (HERO) • Serves as an intermediary in the state for: • HUD Housing Counseling • National Foreclosure Mitigation • First-time Homebuyer Program • Down payment assistance

21. Ways to Build Staff Capacity • NeighborWorks America www.nw.org • Training scholarships through NeighborWorks affiliates • National American Indian Housing Council www.naihc.net • Training for NAIHC members and their partners • Native Community Development Financial Institutions (CDFIs) • Can contract or partner with them to deliver homebuyer education • SDHDA Homeownership Education Resource Organizations

22. Native Curricula • Building Native Communities: Financial Skills for Families financial education curriculum. Contact Oweesta at (303) 774-8838 or www.oweesta.org • Pathways Home: A Native Homeownership Guide.  Contact National American Indian Housing Council at 202-789-1754 or www.naihc.net. Covers: • The mortgage loan process • How to prepare a family budget • How to improve credit profiles • How to avoid the pitfalls of predatory lending • How to maintain a home and finances after purchase

23. Individual Development Accounts • US Department of Health and Human Services (HHS) Office of Community Service (OCS) • Assets for Independence (AFI) funds IDA matches • HHS Administration for Native Americans (ANA) • Social and Economic Development Strategies (SEDS) • Joint OCS/ANA • Native Asset Building Initiative (NABI)

24. Questions or comments?