One of the challenges that most frequently plagues first time home-buyers is credit. Some families have a lack of credit history, others have a low credit score. This hurdle can mean the difference in a family owning a safe and stable home, being involved in their community, and generating wealth through home equity or bouncing between rental properties.
46% of Wacoans own their home. NeighborWorks Waco often wonders what our community might be like if a larger number of community members were financially invested in their community. How might the appreciation in property value impact the wealth of our neighbors? What would be the condition of homes inhabited by owners rather than renters? In what ways would communities improve if members had buy-in?
That is why we wanted to help clients overcome the challenges of credit. Our Project SAVER is now in its third year. This initiative helps clients improve their credit through a strategic partnership between NeighborWorks Waco and First National Bank of Central Texas. Qualifying clients receive a $300 loan and must pay it back over nine months. NeighborWorks Waco’s certified housing and financial counselor, Juan Tello, works with the clients to establish and manage a household budget. If the loan is paid back appropriately, NeighborWorks Waco awards the participant a gift of $200.
Over the nine-month period, if clients make all debt-service payments on time, we see their credit scores rise. Some clients have seen credit improvement of more than 100 points! If credit is the issue limiting homeownership for a family, the incentive provided by NeighborWorks coupled with First National Bank of Central Texas’ loan, can turn the tide. We have seen participants who improved their credit, then purchased their first home.
More than 60 families have gone through this program over the years, and we have room for 30 participants in the upcoming round. If you or someone you know might benefit from this program, reach out today by calling our Homeownership Planner, Juan, at (254) 265-6945! Space is limited.