An area credit union recently received a $2.1 million grant to help families across the region achieve their dream of home ownership.
Appalachian Community Federal Credit Union (ACFCU) was one of fewer than 20 financial institutions to receive funding in a highly competitive national grant process for the “Project Reinvest” program. Through the grant, two hundred low-income families will receive a downpayment assistance loan in the amount of $10,500 to help them complete their home purchases.
“Homeownership is one of the most effective paths to building wealth and financial security, and for many low and moderate-income families it is the only path,” ACFCU CEO Ron Scott said. “ACFCU provides members with tools to manage their finances and improve their credit scores. We provide a variety of fair lending options. But, many deserving families still cannot muster the initial resources required for homeownership, so we’re grateful for this opportunity to help radically change peoples’ lives for the better.”
ACFCU will be partnering with multiple housing-related organizations across 30 counties in Tennessee, Virginia, and Kentucky. The credit union plans to begin the Project Reinvest program this month and complete it over the course of the next two years.
Here in Northeast Tennessee, the ACFCU will be working with Eastern Eight Community Development to implement Project Reinvest. Eastern Eight serves the eight counties of Northeast Tennessee, including Carter County, with a variety of housing programs for those meet income qualifications.
Families with incomes at or below the Area Median Income (AMI) may qualify for a downpayment assistance loan through the program. For most of the Tri-Cities region, that equates to an annual income of around $50,000 for a family of four. Here in Carter County, that number is slightly lower at $49,812 for the median income.
The income eligibility is one of the important things about this particular program according to Eastern Eight’s Executive Director Retha Patton.
“This particular program actually goes up to 100 percent of the Area Median Income,” Patton said. “Most of the programs likes this are cut off at 80 percent of the AMI.”
With the Project Reinvest program allowing individuals to qualify with 100 percent AMI, Patton said that opens up the program to assist many more local families.
While many families in that income range qualify for home loans, Patton said many of those families still experience difficulties when it comes to becoming a home owner. She said some of Eastern Eight’s clients lack the upfront funds required in order to close on a home.
“Everybody can make their house payment because they are paying rent, but hardly anyone can save the money for the downpayment,” Patton said.
Many of those families aren’t able to purchase a home even with assistance through other housing programs.
“This really could be the difference between turning families away or saying, ‘Wow, with this extra resource we can get you into a home finally,” Patton said.
The program can also help those purchasing homes to be able to qualify for a higher level of loan, allowing them to purchase a better home or to buy a home that needs some work and be able to have money to complete those repairs or renovations.
“For a lot of reasons this program is just awesome,” Patton said.
Families who receive the downpayment assistance loans will only have to repay those funds if they sell or refinance their home. To help the families prepare for the challenges of owning their own home, recipients must complete eight hours of home ownership training.
“Project Reinvest isn’t just about getting families into their own homes,” Scott said. “We want the families who benefit to be prepared for the various ‘bumps in the road’ that homeownership entails.”
As part of the program, ACFCU will be working with a variety of realtors, lenders, non-profits, and others to identify potentially income eligible families and help them achieve their dream of owning their own home.
Potential buyers, realtors, and others needing additional information about the program are asked to contact Curtis Montgomery, ACFCU’s Partner Support Coordinator, by telephone at 423-230-2648 or by e-mail at cmontgomery@myacfcu.org.