Only 31% of black residents own a home; new workshop, with banks joining, hoping to change that | Local News

WATERLOO — Three banks and a credit union are teaming up with a local organization for a five-week workshop designed to close the major gap between white and black residents in homeownership.

A five-week in-home workshop will be presented by 24/7 BLAC beginning Feb. 5 from 10 a.m. to noon at UNI-CUE, 800 Sycamore St., Waterloo.

Topics covered will include preparing to buy a home, managing money, getting a mortgage, and understanding credit. The workshop costs $25 per person, and those who complete it will be entitled to $2,500 from BLAC 24/7 and a savings of $2,000 from Veridian Credit Union to pay for a down payment, closing costs or expenses. other mortgage-related needs.

“Banks and credit unions sometimes aren’t the most comfortable place for people to be,” said Robert Smith, Executive Director of UNI-CUE and Vice President of 24/7 BLAC. “What we’re trying to do is get people familiar with how these lending institutions work and then partner up.”

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Black Hawk County is among several places in Iowa where it is financially more advantageous to buy a home than to rent, with residents only needing to earn 23.5% of the average local wage to buy a home 3-bedroom apartment at median price, according to Attom Data. 2022 Rent Affordability Report. Attom noted that the median selling price for such a home in the county in 2021 was $162,000.

Despite this, Black homeownership was only 31.6% in the Waterloo/Cedar Falls metro area in 2021, which is staggeringly lower than the 72.7% of white residents who owned a home.

This is due to a myriad of factors – long-standing red lines and lending biases among them – that ultimately result in keeping black residents from achieving the generation of wealth that home ownership historically has. allowed, said Gwenne Berry, director of diversity at the University of Northern Iowa and a 24/7 BLAC board member.

“It’s not a one to two percent gap — it’s significant,” Berry said. “It tells us that it’s not just people who don’t want to (own a home). There have never been people who don’t want to. These are people who can’t or have been turned down, and that’s what we mean when we talk about systemic racism. »

A recent study by real estate firm Zillow found that nearly 20% of black mortgage applications nationwide were turned down in 2020, nearly double the application rate for whites. The study found that black mortgage applicants were turned down 84% more than white applicants, up from 74% in 2019.

Smith has written guest opinions in The Courier over the years regarding wealth creation and money myths in the black community that he believes have contributed to the gap. But he noted that the workshop needs to address more than just individuals’ financial literacy in order to move the needle on the racial gap.

“If members want to do all they can to own their homes, institutions in this community have a responsibility to do better than what has been done in the past,” Smith said.

It’s something financial institutions seem more eager to help of late: Last year, GreenState Credit Union set a goal of lending $50 million a year for the next 10 years to black borrowers, which would represent a 67% increase over what she lent to black members. in 2020. Instead, it lent more than $70 million in 2021, more than 10% of which went to 54 Black Hawk County residents getting new mortgages or bridging loans.

GreenState lends over $7 million to black homeowners in Black Hawk County

The banks involved in the latest 24/7 BLAC workshop are Community Bank and Trust, US Bank and Wells Fargo, as well as Veridian Credit Union. Berkshire Hathaway HomeServices is also a partner in this effort.

“I think people want to help us get it right – I really do,” Smith said. “We have to do much better than what has been done in the past.”

Those with questions can contact LeKeisha Veasley, community inclusion strategist at Veridian, at (319) 287-8455 or [email protected]

During a virtual banquet, Joy Briscoe urges the community to continue their efforts to achieve the dream of MLK Jr.

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