CEDAR CITY, Utah, June 10, 2019 /PRNewswire/ -- A federally chartered mortgage agency that provides down payment assistance to homebuyers is digging deep to help address the U.S. housing crisis, announcing a $1-million investment to boost rental opportunities for lower-wage workers.
The investment by the CBC Mortgage Agency (CBCMA) will accelerate the acquisition, rehabilitation, and development of affordable and workforce housing, especially in communities where gentrification and soaring rents have priced out many lower-income families.
CBCMA's investment is a new twist on the agency's longtime mission of providing down payment assistance to help creditworthy buyers across the U.S. break into homeownership.
Over the years, the agency has helped more than 15,000 borrowers in 49 states achieve the dream of homeownership through its Chenoa Fund program. More than half of CBCMA's borrowers are African American, Latino, or other minorities who lack the funds necessary to meet the down payment threshold to obtain an FHA-insured loan.
But the agency's leaders recognize that home ownership is not the next step for everyone. As a result, they are investing $1 million in the Workforce Housing Opportunity Fund (WHO), part of the Trump Administration's efforts to use tax cuts and other development incentives to spur rehabilitation of distressed communities known as Opportunity Zones. The Chenoa investment represents lead capital expected to entice another $19 million in support. Once its entire equity raise is completed, WHO plans to leverage a $300 million impact in the nation's housing market. WHO intends to focus its initial efforts in California, Maryland/DC and Texas.
"WHO is dedicated to helping hardworking families remain in their communities by expanding the availability of rental housing that is within their financial reach," said Michael Whipple, Vice President of CBCMA. "That is a mission we fully endorse, and we are delighted to be contributing to this collaborative effort made possible by the Opportunity Zone program."
As demand for rental housing continues to rise, vacancy rates are at near historic lows, driving prices up and out of the reach of many lower-income families. More than 11 million Americans now use more than half their monthly salaries for rent, and statistics show that renters need to earn at least $20.30 per hour to afford a modest, two-bedroom apartment in the U.S. In six states and the District of Columbia, affording such an apartment requires an hourly wage of at least $25.
WHO's goal is to increase both affordable housing, or housing at rents that are affordable to individuals and families at or below area median income, and workforce housing. Workforce housing is housing that is affordable to households within reasonable proximity of their workplace, and to tenants whose incomes are at or below 120% of area median income.
As it works to increase housing affordability and access, WHO is committed to partnering with community-based and faith-based community groups, such as the Community of Hope Community Development Corporation. An affiliate of Beltsville, Maryland-based Hope Christian Church works to enhance long-term stability and restoration of surrounding communities.
Bishop Harry R. Jackson, senior pastor of the church, said WHO answers the need for a "new model that brings nonprofit community organizations into alignment with investors and the Opportunity Zone program to create affordable housing."
"Millions of Americans are struggling to afford something that is essential to our ability to survive and thrive as human beings – a place to live," Jackson said. "This program will bring new housing opportunities to blighted communities, helping people who are most in need of an uplift. We commend CBCMA for its support of WHO on this critical quest."
CBCMA is owned by the Cedar Band Corporation, which was founded by the Cedar Band of Paiute Indians in 2002. From its humble beginnings, the Cedar Band Corporation has blossomed to include a diverse array of companies, from premier defense and government contracting firms to a successful convenience store, award-winning wine distributor, and soon-to-open full-service travel plaza.
Contact: Doug Elmets
SOURCE CBC Mortgage Agency