Many challenges come with owning a house, especially if you’re a black American. The process of owning a house as a black American can be tough because of racism and disparities often stacked against people of African descent.
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The good news is that as an African American, you can take advantage of homeownership assistance programs to reach your goal of owning a house. Continue reading to learn about these initiatives and how owning a home is a step away.
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Types of Homeownership Assistance Programs
A report from The Mortgage Reports shows over 2,000 homeownership assistance programs exist in the US. This means that homeownership assistance programs could help 1 in 3 denied home buyers.
These programs fall into different assistance categories for aspiring homeowners. Hence, as an African American, it’s crucial that you understand the difference between the programs to know where to begin your loan search.
Here are the main homeownership assistance program categories:
Grant
The most common type of help aspiring homeowners can receive is grants. They can come from different agencies or organizations but are gifts you don’t pay back. Down payment grants are usually regulated on a state and local level.
Check these books on Amazon to learn more about grants.
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Loans
Loans are the second type of help you can get as an aspiring homeowner. However, traditional financial institutions aren’t responsible for these types of loans.
These loan programs offer benefits, such as varied approval requirements, deferred payments, or even loan forgiveness over time. They are available to make homeownership easy for many Americans, including those of African descent.
The VA loan is among the popular loans for aspiring homeowners in the US. It’s a loan that allows veterans to buy a house without a down payment. You can also get one or two books on Amazon to learn strategies for using a VA loan. One thing to always remember is that the requirements for these loans vary from program to program.
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Homeownership Programs Eligibility
Generally, most homeownership assistance programs target first-time homebuyers. Income and purchase caps are the eligibility criteria for many homeownership programs in the US. But it’s almost impossible to find two programs with the same eligibility requirements. So, ensure to check as many programs as possible.
Most of them have educational components to qualify. So, you should be ready to enrol in financial literacy and home education courses when you decide to use homeownership assistance programs.
Benefits of Homeownership Assistance Programs
Homeownership programs were created to help make buying real estate easy for all. They help you buy real estate on a faster timeline than you would have been able to do on your own.
These programs save buyers money over time. In most cases, the common challenge when purchasing a home is saving for the down payment. It can take years to save up the standard 20%, depending on your source of income.
However, most homeownership initiatives require a lower down payment. With this, aspiring homeowners can buy houses pretty much faster.
Here are the key benefits of Homeownership Programs:
- It makes owning a house achievable for low-income households
- Offers potential tax advantages for homeowners
- Provides education on homeownership responsibilities and money management
- It allows you to build wealth and equity through property ownership
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How Much Funds Can You Qualify for?
Many programs use your homeownership history and geographical location to determine how much you can qualify. The specific program you’re applying for also determines the amount of funds you can receive. This can take the form of a forgivable home loan in the tens of thousands or a down payment grant for a few thousand dollars.
Additionally, some grants also depend on the home’s total cost. For example, some programs with down payment help provide between 3% and 5% of the total loan in monetary help. You just need to research and equip yourself with the necessary information so you can increase the amount that you’ll receive.
As an African American, if you want to buy a house but your income is low, homeownership assistance programs could help. With the information shared here and a bit more research, you should find the best program that’s perfect for you. Don’t forget to get your homeowner tool kit from Amazon when you finally buy your dream house.
People Also Read: Racial Disparities in Banking: Is it Harder to Get a Loan If You’re Black?
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