Did you know that racial disparities in homeownership, in MN and WI, are some of the worst in the nation?
In MN, roughly 77% of white households own their home while only 30.5% of black households own their own home.
In Wisconsin, 72% of white households own their own home while only 25.5% of black households own their own home.
Unfortunately, this isn’t shocking considering Black Americans have been excluded in some way, shape, or form from the real estate market for the last 400 years.
Everyone knows of our shameful history, but less people are aware of our more recent history.
After WWII when the Federal Housing Association (FHA) was organized, they were offering low down payment, federal backed mortgages. Guess who was excluded?
The FHA not only funded mortgages, but also funded development projects. Developers, even if they wanted to offer homes to anyone other than people of white ethnicity, were not allowed to by the American government. If there was even one black family in these housing developments, the FREAKING FEDERAL Housing Association, pulled the funding for the development.
The civil rights act of 1968 outlawed housing discrimination which ended a lot of discriminatory practices at the time, but ultimately people found other ways over the next 50 years to discriminate.
In no specific timeline, the last 50 years has seen predatory lending tactics, prior zoning restrictions leading to suppressed education, higher rates of loan denial, discriminatory appraisals, suppressed wages, and state sanctioned intimidation and/or violence. These tactics have been used, not only to discriminate Black Americans but for a lot of minorities around the US.
WOW LEILA STOP DEPRESSING US! HOW DO WE DO BETTER?
As an ally my goal is not to bring people down, but lift them up!
Well…
There are good people out there! There are people that come together and try to make the world a better place. There are more resources out there than ever before. There are more organizations working toward helping than ever before. Here is a list of resources and people that are there to help fight the good fight and help get people into homes and combat discrimination:
Everywhere:
First Generation Homebuyer Grant– New this year! This is a forgivable grant that will give you 10% up to $35,000 for down payment or closing cost assistance! You or your parents can never have owned a home.
Section 184 – A federally backed loan that guarantees reservation purchases for Native Americans. It is coupled with lower interest rates and lower down payments.
NAREB– Is an “equal opportunity and civil rights advocacy organization for African American Real Estate Professionals, Consumers, and Communities.” NAREB advocates for black homeowners and black real estate professionals!
MN & WI
Minnesota Housing Finance Agency– I can’t speak highly enough of this program! This is a state program and on a consumer level MHFA provides down payment AND closing cost assistance to first time home buyers. They offer many programs, but the one I usually work with is a down payment and closing costs 0% loan. They give you up to 17k to help with the buying process. They require the first time home owner to show up with $1,000 of their own money. I work with this one a lot and I LOVE it. On a higher level MHFA offers numerous large grants to NGO’s/non-profits that help with all sorts of housing issues.
Wisconsin Housing & Economic Development Authority (WHEDA)– Wisconsin’s loan programs for home buyers. If using these programs you can get down payment assistance, lower interest rates, and sometimes up to 100% financing. They also offer grants to nonprofits that build or refurbish homes!
Minnesota Association of Realtors DEI committee- Working on a project to eliminate names for the purchase agreement, to eliminate racial bias from sellers!
Just Deeds– Offers free title and legal help to remove discriminatory language in deeds!
Lutheran Social Service Credit Counseling – Counsels people on how to improve their credit!
Hyper Local
1 Roof Land Trust Program– A home sale program that offers great homes at an affordable reduced market rate! One roof owns the land, the home owners own the home. When selling, homeowners use a part of their equity to help pay for the affordability gap for the next owners!
1 Roof Credit Counseling & First Time Home Buyer Class
1 Roof PAL Loan– A secondary mortgage that loans up to 18% of the primary loan to drop off the cost of private mortgage insurance.
Community Action Duluth Savings Program – For every 1$ you save CAD will save 3$, up to $6,000 Matched or $8,000 total!
Duluth HRA- Committed to providing affordable homes to the community. They have their own programs, they partner with other organizations, and provide grants to other nonprofits working toward housing goals.
First Time Home Buyer Bank Programs–
- Bell Bank 1% down
- US Bank 2% down
- FHLB 15k Grant
- Chicago Bank 10K grant
- Park State Bank 15k grant for Native Americans
***NOTE all of these programs have additional terms. Contact your local Real Estate Agent to help you navigate these!***
WHEW! There is so much out there! And these are only the ones that I know of! Obviously this list comes from my knowledge base, and is focused on the areas that I service. If you live outside this area, lean into a trusted Real Estate Agent. Interview them and ask them questions. What programs are out there to help? Do a google search. Not all agents are knowledgeable on local programs. It’s ok to search around!
I highly encourage anyone coming from a place of disadvantage to LEAN IN. Use the resources out there. Anyone that you see out there that is successful, is successful, because they know how to draw on the resources available to them. You too can own a house! These resources are here to help and so am I!
