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Home Loan for Black Borrowers
Imagine getting the keys to your new home and your down payment and monthly will be significantly less than your rent? That is exactly what this blog article will help you achieve. It was a surprise to me learning that Legacy Home Loans recently launched a low money down home grant just for black people.
The program is in response to Bank of America’s No Money down affordable home grant program. The home loan just for black people is called Closing The Gap. The name signifies the 30% difference in black and white homeownership. Only 4 out of every ten black families own the home they live in. While 7 of ten white families own the home they live in.
The gap difference is important to the CEO of Legacy Home Loans (Ben Slayton) because he was the first black REALTOR in the United States. I was mind blown to learn his story. As a REALTOR for the last 10 years myself, I didn't realize how much I take that title for granted.
Ben experienced a lot of challenges on his venture to make a living as a real estate agent. In a recent podcast interview he remembered all the obstacles and racism like it was yesterday. He recalls specific verbiage in deeds that stated black people could not buy or live in certain houses. He also recalls needing a non black person to vouch for him in order to get real estate deals closed.
His career took a while to take off but he was determined and has successfully built multiple real estate and mortgage businesses since. Again, this is why he is on a mission to help more black people become homeowners if they desire that.
The Closing the Gap Grant Program will be piloted in these cities:
If your city wasn't mentioned, don't worry. More programs are likely to develop as a result of Closing the Gap and Bank of Americas Affordable Home Loan Solution program. In the meantime you can learn as much as possible in my home buying workshop or download my free home buying guide so you aren't left behind when it's your time.
Key features about the Closing the Gap program
- The borrower can move anywhere as long as they currently reside in a census tract of the 6 cities listed that have 51% or more black population.
- Only a 1% down payment is required but you can put more down if you desire.
- You get a Free appraisal (valued between $500 to $800) on a 1,000 square foot house.
- Free home warranty (valued $400 to $900) on a 1,000 square foot house.
- Free pre-purchase home buying counseling.
What is Pre-Purchase Counseling
Some buyers have asked, why is pre-purchase counseling necessary? Although buying a home seems easy, it can be a challenge if you’re not prepared. The pre-purchase counseling is to get a borrower prepared and to understand the following:
- Maintaining a home.
- Avoiding predatory lenders (you might receive offers about refinancing after you buy).
- Inspections and repairs - understanding major verse minor repairs.
- Home Equity Lines of Credit.
- Title insurance.
There's so much more to buying a home than choosing a pretty house and saving up for the down payment.
In order to obtain a mortgage, you will need to provide certain documents to your lender. These documents may include, but are not limited to:
- Proof of Income: This can be in the form of pay stubs, tax returns, or bank statements.
- Credit Report: Lenders will want to see a copy of your credit report in order to assess your creditworthiness.
- Proof of Assets: This can be in the form of bank statements, investment statements, or real estate appraisals.
- Proof of Identification: You will need to provide a copy of your driver's license or other government-issued identification.
Do you wish you could get more details about the home loan process right now? You can also learn more by watching my Home Buying Process Workshop. We covered how to buy a home from A to Z.
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Do you have any comments about the Closing The Gap program? I'd love to hear your thoughts. Please share below and and we'll be happy to respond to them!