Washington Informer 2018 Homeownership Supplement by The Washington Informer

HOMEOWNERSHIP SUPPLEMENT 2018

HOMEOWNERSHIP: A BIT MORE FREEDOM PRESENTED BY:

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Cerita Battles SVP, head of Retail Diverse Segments Wells Fargo Home Mortgage

Advancing African-American Homeownership is Important to Wells Fargo

It’s June and we are excited that another Homeownership Month and homebuying season is here. Wells Fargo is again pleased to be title sponsor of the Washington Informer’s Homeownership Month supplement. From us this year you will hear about the mortgage landscape in D.C., why homebuyer education and counseling is beneficial and how Wells Fargo continues work to rebuild trust with our customers. Advancing African-American homeownership is something Wells Fargo cares deeply about. Last year we announced our commitment to create at least 250,000 African-American homeowners by 2027 by lending $60 billion for home purchases, dedicating $15 million for initiatives that support homebuyer education and counseling, and increasing the diversity of our sales team, including African-American home mortgage consultants. We’re making progress. In 2017 we helped more than 23,000 African-American families achieve the goal of homeownership and provided more than $1.8 million to support homebuyer education and counseling. We continue to work on increasing the diversity of our sales team and promoting the mortgage industry as a career option, as African-American representation currently stands at 4.7 percent. While we are making progress, our African-American homeownership commitment is a longterm goal and one that won’t be easy to achieve. But we are dedicated and are working very hard to make sure we achieve these goals. We are investing in new initiatives like HomeFree USA’s Center for Financial Advancement, designed to help African Americans prepare for homeownership and financial freedom while exposing students to the mortgage industry as a career option. We also are focused on being present in African-American communities to better assist aspiring homeowners. We want homebuyers to see us, know that we are in the community and available to assist with homebuying needs. Advancing homeownership for minorities and low- to moderate-income families is important to Wells Fargo. We want to meet customers where and how they want to work with us. Customers can meet with a home mortgage consultant face to face at a mortgage or bank branch in D.C., call us on the phone, or even work with us virtually by going to our website at www. wellsfargo.com/mortgage. We continue to increase our digital capabilities with our online mortgage application, which can auto-populate Wells Fargo account information for customers who log in with their online banking password. This technology can provide customers the flexibility to complete the mortgage application at their convenience, including from the comfort of their own home. Becoming a homeowner is an exciting journey and Wells Fargo wants to be right beside our customers helping them every step of the way. Happy Homeownership Month!

www.washingtoninformer.com / THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018

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FROM THE EDITOR

A Bit More Freedom

African-American family pose in front of housing purchased through GI Bill legislation. / Photo courtesy of Library of Congress Collection.

Dr. Shantella Sherman Informer Special Editions Editor As early as 1891, African Americans demonstrated a particular desire to purchase land and build homes as an extension of their citizenship. Undeterred by the failures of legislative land redistribution following the Civil War that initially proposed offering the formerly enslaved 40 acres of land and a mule, participants of the Negro Conference, hosted by Tuskegee University touted homeownership, along with education, as primary goals of race progress. In the Report of the Fifth Tuskegee Negro Conference (1896), conference attendees discussed at great lengths the necessity of obtaining land despite a mortgage system they said operated very seriously against them, as “a little more freedom.” “It is not that the whites will not sell the negro land. It may be said that throughout the South there is a general disposition to allow

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the negro to accomplish whatever he can in this direction; however, four-fifths of the negro farmers still allow the most binding mortgages to be made upon their unplanted crops, and that frequently in the fall all a man has raised is swept away to pay the mortgage. He has neither money nor provision to subsist upon during the winter,” the report concluded. Similarly, by 1906, W. E. B. DuBois celebrated the freedom of land and homeownership in strengthening Black economics, that supported higher education, promoted Black-owned businesses, and fostered social cooperation both within the race and among fellow Americans. “The freed hands started forward by a third way that of land ownership. Most of those who got any start became share-tenants and a fourth of these succeeded in buying land. Those who bought land approximated economic independence, forming the closed plantation economy of the olden times

but with colored owner, colored laborers, and colored tenants. In an increasing number of cases the colored store came in to help them and we have a complete system of what I have called the group economy,” DuBois said in a speech The Economic Future of the Negro. The theoretical practice of associating land and homeownership with access to capital, and thereby establishing American citizenship, transformed the nation, making it a critical component of The American Dream. As William Collins and Robert Margo, researchers at the Cambridge-led National Bureau of Economic Research found, the importance of the mortgage in American homeownership grew enormously between 1900 and 1990 and ran concurrent with challenges to Jim Crow lending and urban redlining. Redlining, a discriminatory pattern of disinvestment and obstructive lending practices that impede home ownership among Blacks and other people of color, has

Redlining, a discriminatory pattern of

disinvestment and obstructive lending

practices that impede home ownership among Blacks and other people

of color, has played out against racial,

political and socioeconomic constructs in Washington D.C. for generations.

Part of the 2017 exhibition Undesign the Redline, sponsored by Pepco detailing blockades to Black homeownership. / Photo by Shantella Y. Sherman played out against racial, political and socioeconomic constructs in Washington D.C. for generations. Documented in the 2017 exhibit, “Undesign the Redline,” at Pepco Edison Place Gallery and facilitated by Enterprise Community Partners, a finance and development nonprofit that promotes affordable housing, redlining worked to destabilize many of the gains made through Black and minority homeownership. Redlining grew out of the policies developed by Franklin Roosevelt’s Administration to reduce foreclosures during the Depression. Federal housing agencies determined whether areas were deemed unfit for investment by banks, insurance companies, and other financial services companies. The areas were physically demarcated with red shading and were based on the area’s racial composition rather than income levels. By blotting these neighborhoods from economic security – often denying loans to homeowners and businesses – the neighborhoods quickly declined and could then be further charted for economic exclusion.

THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018 / www.washingtoninformer.com

In speaking with fair housing advocates, including David Bowers, vice president and mid-Atlantic market leader at Enterprise Community Partners, the central theme of redlining, appears to have created a financial albatross from which few potential Black homeowners escape. “Redlining is not accidental. People fought and planned to keep Blacks, women, and others, out. It was intentional to and designed to legally deny you access. It was intentional, and Enterprise wants to inform people, anger people, and move people,” Bowers said. Still, despite many of the same challenges faced by potential homeowners at the turn-of-thecentury – including affordable units, disparate mortgage rules, and redlining – homeownership is not only attainable, but continues to offer the same financial security and wealth-building potential. The Washington Informer supports African-American homeownership and offers this supplement as a helpful guide to attaining “a bit more freedom.”

Read. Learn. Grow. Dr. S.

Homebuyer Education and Counseling is a Great Step for Aspiring Homeowners

By Donna Greene Regional Diverse Segments Manager Wells Fargo Home Mortgage

The desire for homeownership in America remains high. In a 2017 NeighborWorks America survey, 93 percent of respondents said homeownership is important, very important or the most important. Homeownership is important to our economy, our families and our communities and a key vehicle for wealth accumulation. Census data cited in the 2017 National Association of Real Estate Brokers (NAREB) State of Housing in Black America report says that 69 percent of an American household’s net worth is attributable to the net equity in their home.

Becoming a homeowner is an exciting journey, and preparation is a key to success. Homebuyer education and counseling agencies are important resources to help aspiring homeowners prepare for and navigate the homebuying process to become sustainable homeowners. Through education and understanding of what to expect, homebuyers can get in a home and be successful homeowners over their lifetime. Homebuyer counseling offers one-on-one sessions with a HUD-approved counselor who tailors interactions to the prospective homebuyer’s situation and homeownership needs. Counseling helps prospective homebuyers gain confidence and information needed to take the next step toward buying a home with activities that include budgeting, identifying credit challenges and guidance to improve their credit score, debt reduction strategies and helping to determine affordability based on income and debt. Counseling also helps to dispel common myths about obtaining a mortgage loan, like

“a 20 percent down payment is required to own a home.” That is not true and holds many homebuyers back from making the step forward and actually applying for a mortgage. Homebuyer education focuses on the basic concepts of homeownership but is not specific to a transaction. Also provided by a HUD-approved agency, topics covered in these classes include the homebuying process, how to maintain a home and the importance of good credit. Homebuyer education classes can be helpful for aspiring homeowners who have been approved for a loan but need information on better understanding the process to achieve and sustain homeownership. At Wells Fargo we believe in the value homebuyer education and counseling can bring to those seeking homeownership. It’s a significant component of our $60 billion lending commitment to increase African-American homeownership by 2027. In the commitment we pledged to dedicate $15 million to support initiatives

for homebuyer education and counseling for African-American families. In our first year, we have provided more than $1.8 million toward this goal in the first year. Wells Fargo also collaborates with a number of agencies to bring homebuyer education and counseling into communities across the country. Here in Washington, D.C., Wells Fargo has been a sponsor of the DC Housing Expo hosted by DC Housing and Community Development and the Greater Washington Urban League for the past eight years. Homebuyer education is a requirement of the NeighborhoodLIFT program, a national collaboration between Wells Fargo and NeighborWorks America that also provides down payment assistance grants. It’s important to us at Wells Fargo that our customers are successful homeowners. And we believe that homebuyer education and counseling should be components of the homeownership journey, especially for firsttime homebuyers. HS

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Get a yard Peanut can sink his paws into Buying a home can be simpler with an online mortgage application that gives you the option to easily connect with your financial accounts and upload documents. Plus, you’ll have personalized guidance every step of the way. I’m here to help you reach your homebuying goals. Contact me today to get started — or apply online at wellsfargo.com/newdigs. Call, stop by, or click today! 4926 Wisconsin Ave. N.W. Washington, D.C. 20016 202-895-5150 1-800-771-3476 www.wfhm.com/dc-washingtondcbranch-washington

Information is accurate as of date of printing and is subject to change without notice. Wells Fargo Home Mortgage is a division of Wells Fargo Bank, N.A. © 2018 Wells Fargo Bank, N.A. All rights reserved. NMLSR ID 399801. AS4423979 Expires 08/2018

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We’re re-committing to you

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Commitment to Community is Top of Mind at Wells Fargo

By John Allen Region Bank President for Washington, D.C. Wells Fargo

For more than 100 years, Wells Fargo has been a part of the fabric of our nation’s capital. Arriving in the city on the Baltimore & Ohio Railroad in 1914, Wells Fargo has grown from an express delivery company to one of largest banks in DC. Our commitment remains strong today through our relationships with more than 200 local nonprofit organizations, as well as nearly $1.7 million in corporate and foundation giving throughout DC, and more than 2,400 team member volunteer hours in 2017. We realize that we are only as strong as communities we serve, which is why Wells Fargo continues to

be committed to the DC market and be present in our local neighborhoods. As our national ad campaign, “Re-Establish 2018”, demonstrates, it is a new day at Wells Fargo. Our transformation is grounded in our vision of satisfying our customers’ financial needs and helping them succeed financially. While we have made solid progress, we recognize there is still work to be done before we fully transform into the Wells Fargo we aspire to be. Re-established means Wells Fargo is moving forward from a particularly challenging time in its history to apply hard les-

sons learned to every facet of our business. It’s a renewed commitment to serving customers in new and improved ways, and bringing every decision we make to this criterion: is it good for the customer? Re-established is about not ignoring the past, but holding ourselves to a higher standard and moving forward to become a better company. We want to positively impact every community in which we do business through our products, our service, and our culture. This can also be seen in our recent announcement of our $60 billion African American Homeownership

Giving back in Washington, DC in 2017 $286.5 million donated to 14,500 nonprofits and schools nationwide, with $1,682,429 given in Washington, DC in 2017

Arts and Culture: $256,250 Civic: $317,250 Community Development: $500,250

Education: $392,400 Human Services: $216,279 Matching Gifts: $103,917

Commitment. To date, we have delivered $1.8 million in grants to home-buyer financial education and counseling and, we’ve provided $5.74 billion dollars in funding to help more than 24,000 African Americans become homeowners nationwide. In the DC market, Wells Fargo provided $80,000 grants to both Habitat for Humanity and the Wesley Housing Development Corporation of Northern Virginia through our Priority Markets Grant Program (PMP). PMP is designed to support projects, programs and initiatives that help remove barriers to sustainable housing for low-to-moderate income communities. Homeownership can be a reality for anyone, regardless of background, and Wells Fargo is dedicated to providing access to capital and the financial knowledge necessary to make this dream a reality. As we continue to work to rebuild trust and meet the ever-growing needs of our customers, we will continue to provide new and innovative ways to do business. This includes friendly and informative team members in our branches and call centers, to introducing advancements to our mobile banking app like Pay with Wells Fargo, a simplified payments experience – enabling customers to select their most frequently used payment features before signing in to the app. We are proud of our rich history and heritage, yet mindful of the need to evolve and innovate in order to create the best experiences for our customers, our team members and the communities we serve. We will be relentless in our drive to continuously improve so that we can emerge from a challenging period in our history a better company and brand, signaling it’s a new day at Wells Fargo. Established 1852, Re-established 2018. HS

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First Time Homebuyers Should Know… By Stacy M. Brown WI Senior Writer The start of the home buying season has kicked off and there aren’t many areas in the country more active than the District where, with low inventory, it’s clearly a seller’s market. “The average home in D.C. is on the market for eight days or less,” said John Jones of the District-based Wells Fargo Home Mortgage. “D.C. as a whole is starting to see great pockets of growth around Union Station and the U-Street Corridor,” Jones said. “Northeast and Southeast, particularly by Nationals Stadium is completely evolving and folks are concerned about amenities, access to transportation, restaurants and schools and they’re making their homebuying decisions based on those things.” For first-time homebuyers, it’s important that they have done some preparation before applying for a home loan, Jones said. “They should use the resources around them like counseling agencies, the city government, and the internet to educate themselves. Education is key,” Jones said. This includes preparing a budget and having some knowledge about the process. Potential new homeowners should also know that from a regulatory standpoint, little has changed this year -- there aren’t any rules to hinder anyone from buying, Jones said. However, they should recognize the ever-changing interest rates. “Interest rates on a typical 30-year mortgage 18 months ago hovered in the low-to-mid 3 percent. Now the National Mortgage Association says by the end of the second quarter this year [June], the rate may be about 4.6 percent and, by the fourth quarter of 2019 it may be at 5.4 percent or so,” Jones said. “That’s a huge amount of ad-

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ditional interest, so being aware of this is important. “Homeownership is the foundation for a family’s financial success and it provides so much more than shelter,” said Mark Alston, the Public Affairs Committee Chair at the National Association of Real Estate Brokers. “It tends to be the initial genesis of generational wealth, the engine that can fuel business creation, educational opportunity and retirement security. Black homeownership is even more foundational in that it stabilizes neighborhoods, gives a sense of accomplishment, provides people who have been historically cut out, the pride of ownership,” said Alston, who’s also a broker and owner of Alston & Associates Skyway Realty, in Los Angeles. In 2018, 50 years after the signing of the Fair Housing Act of 1968, the percentage of Blacks owning homes [42.1 percent] is statistically the same as it was in 1968. The gap between Black and White home ownership is higher today than it was then, over 30 percent with White ownership at 72.4, Alston said. While other ethnicities are increasing in home ownership percentage, Blacks have generally been in decline since the high of 49.1 percent in 2004, he said. “There are no new programs today that sufficiently address this gap, or decline for potential Black home owners, Alston said. “Risk-based underwriting and pricing models have created an environment where those who have less, pay more. There needs to be an assertive, aggressive push in our policymakers’ agendas to promote and support homeownership opportunity for all Americans, not just the affluent,” he said Wells Fargo, which continues to work toward overcoming the public relations disaster that alleged the company discriminated against Black and Latino

homebuyers in Sacramento, California, by pushing them into more expensive mortgages than White borrowers. In 2017 Wells Fargo announced a $60 billion lending commitment to create at least 250,000 African-American homeowners by 2027.” “Wells Fargo’s $60 billion

lending goal can contribute to economic growth by making responsible homeownership possible for more African Americans in communities across the country,” Brad Blackwell, executive vice president and head of housing policy and homeownership growth strategies for Wells Fargo, said in a statement.

THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018 / www.washingtoninformer.com

“We are proud to be the first mortgage lender to make a public commitment to help increase African-American homeownership. And, we are grateful for the support of key housing and civil rights organizations, who work alongside us to increase economic prosperity in our communities,” Blackwell said. HS

Summer is Here, It’s Time for Pepco’s Peak Savings Days Save Money and Beat the Heat in Maryland This Summer

By Maribeth Sawchuk Senior Communications Specialist Pepco Homeownership offers independence and the opportunity to create a living environment that reflects your personality, style, and values. Managing your home’s energy can be an intimidating part of home ownership, but Pepco customers in Maryland can help reduce their energy costs this summer by participating in Peak Energy Savings Days program. Peak Savings Days are a few days each summer when demand for electricity is highest, and they typically occur for a few hours between noon and 8 p.m. During these periods, you’ll earn a credit of $1.25 off your bill for every kilowatt hour (kWh) you save below your average energy use. The more you reduce your energy use, the more you can save. For example, if your average energy use is 19 kilowatt hours (kWh) a day and you reduce your energy use to 15 kWh during a

Peak Savings Day, you’ll receive a $5.00 credit. Reducing your energy during a Peak Savings Day is easy; you can turn up your air conditioner’s thermostat a few degrees and head outside and cool off at a nearby beach, pool, or park. Head over to Raccoon Point in Westover, Md. and enjoy the waterfront with a beach and picnic tables. You can head to Crab & Cruise in Crisfield, Md., or take a dip in one of Montgomery County’s seven outdoor community pools, or maybe catch fireflies at the Lightning Bug Jubilee at the Brookside Nature Center in Silver Spring. In Prince George’s County, you can calm those summer nerves at Yoga in the Park at the Tucker Road Community Center in Fort Washington, Md. or bring the kids to Evening Drop-In Soccer-Safe Summer at Heurich Park in Hyattsville, Md. Managing your home’s energy use is easy with these great local options. It’s your choice whether to participate on a particular Peak Savings Day – there is never any

enrollment and signing up is not necessary. There is also no penalty if you choose not to participate in the Peak Energy Savings Credit program.

HOW TO PARTICIPATE:

• No enrollment. When a Peak Savings Day is announced you’ll automatically receive a phone call the night before with the official hours for reducing your energy use. You can also choose to be notified by text or email. To set your preferences, log in to the “My Account” section on your Pepco account. Visit: www.pepco.com/ peak • Save energy. Reduce your energy use below your average during the specified hours of a Peak Savings Day to earn a credit off your bill. • View your credit. On average, customers receive a $5.00 credit on each Peak Savings Day. You’ll see your credit on your next bill or online through “My Account.” Visit: www.pepco.com/peak

Saving energy on Peak Savings Days can be as simple as waiting to run major appliances until later or reducing air conditioner use, if health permits. You can also follow these quick and easy tips to help you save on Peak Savings Days: • Close shades and blinds to the hot sun • Unplug chargers and electronics • Switch off unused lights

• Use a fan to circulate air instead of air conditioning • Run major appliances before or after specified hours • Cook outside or use a microwave instead of an oven • Put computers in sleep mode or turn them off entirely • If you have central air conditioning or a heat pump, sign up for Energy Wise Rewards™ and make saving automatic. Visit: www.pepco.com/rewards HS

Homeownership offers independence and the opportunity to create a iving environment that reflects your personality, style, and values.

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REALIZE YOUR DREAM OF HOMEOWNERSHIP INDUSTRIAL BANK HAS PROGRAMS AND SERVICES TO MEET YOUR UNIQUE NEEDS DOWN PAYMENT ASSISTANCE PROGRAMS * FIRST-TIME HOME BUYER PROGRAMS * MARYLAND SMARTBUY PROGRAM* FHA, CONVENTIONAL AND VA LOAN PROGRAMS * HOME EQUITY LOANS AND LINES OF CREDIT * REVERSE MORTGAGES * * Offer of credit is subject to credit approval

Find Out More Information: ibmortgage@industrial-bank.com www.industrial-bank.com 202-722-2000

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DC’s DHCD: Our Programs Help People Establish, and Maintain, Roots in the District By Polly Donaldson Washington DC is a prosperous and growing city; I know this not just by looking out at the construction cranes from my office window in Anacostia, but by reading the data showing that our population will grow to 800,000 within the next decade. The city’s vibrancy and popularity is exciting; but we know residents are concerned that higher housing prices may make

establishing, or maintaining a home in the District, difficult, if not impossible. The administration of Mayor Muriel Bowser doesn’t want that to happen. That’s why from day one, her priority has been to use more District resources to build pathways to homeownership for residents. That’s where the DC Department of Housing and Community Development comes into play. Part of our mission is to produce and preserve affordable housing for low- and moder-

ate-income residents. But our mandate under the Mayor is to take that a step further—by providing more homeownership opportunities. As the Mayor says, whether someone has been here for five minutes or five generations, they should be able to call the District home. That’s why each year, she’s made an unprecedented commitment of $100 million annually to the DHCD-administered Housing Production Trust Fund (HPTF). As a result, since

District of Columbia DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT

We Are Dedicated to Producing and Preserving Affordable Housing, Revitalizing Neighborhoods and

Promoting Homeownership Polly Donaldson, Director 1800 Martin Luther King Jr. Avenue SE

(202) 442-7200 dhcd.dc.gov

2015, the HPTF has delivered affordable rental and homeownership units for over 12,700 residents. This investment is improving the lives of District residents today—and will for decades to come—despite the rising real estate market. We’ve given first-time homebuyers more purchasing power by enhancing these DHCD programs: • Our Home Purchase Assistance Program (HPAP), which provides up to $84,000 in down payment and closing cost assistance and allows low-income households to defer HPAP repayment until they sell/no longer occupy or refinance a property. We are proud to say that since 2015, HPAP has helped nearly 900 households get the keys to their first home. • The Employer Assisted Housing Program (EAHP), which gives District government employees up to $20,000 in assistance—as well as matching grant funds—and has an extra incentive for first-responders. Keep in mind that District government employees can use both HPAP and EAHP— potentially providing them with over $100,000 in assistance! We’ve also made improvements to our Inclusionary Zoning (IZ) program, which ensures that a certain percentage of affordable units are included in most new or substantially rehabilitated developments. Last year, IZ delivered nearly 200 units of new affordable housing in 23 mixed income developments, and more is coming. D.C. Public School teacher Jackie Clauss used HPAP to purchase her first home in Ward 5 through IZ. “My three kids and I are forever grateful,” said Clauss, “My family was blessed with a home. It was a long way,

but we got there.” DHCD programs are not just about filling out financial paperwork. We help residents prepare for all aspects of homeownership by offering housing counseling services. DHCD-funded community-based organizations hold group workshops and one-on-one counseling for tenants, potential homeowners, and current homeowners on issues such as foreclosure prevention or mitigation, credit counseling, home/budget management, homebuyers’ clubs and relocation, applying for program assistance, managing the home purchase process, homeowner training, and apartment locating. Jessica Franklin joined a homebuyers’ club that set her on a path to become a first-time homeowner of a three-bedroom townhome in Ward 8. HPAP gave her more than $81,000 in assistance. In addition, DHCD holds events for residents, from the Annual DC Housing Expo and Home Show—which recently celebrated its 10th anniversary—to smaller workshops on IZ, rent control and other housing issues. Residents also can access tools in our Housing Resource Center at DHCD headquarters, or visit DCHousingSearch.org, to help search for housing. DHCD wants you to know that because of these and other District government programs, more individuals and families from every ward are calling the District their home. It is not impossible! Learn more about all the housing programs available to DC residents through Mayor Bowser’s Roots to Roofs DC initiative, at rootstoroofsdc.com. HS

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DC Mayor Muriel Bowser invites you to celebrate A month-long initiative on how Washington DC is producing and preserving affordable housing, and revitalizing neighborhoods.

Our kick-off events included the June 1 launch of a new $2 million fund to help non-profit developers finance affordable housing projects and the 10th Annual DC Housing Expo and Home Show on June 9. We will be holding other activities throughout the month, including: A June 14 public hearing by the DC Department of Housing and Community Development (DHCD) on the transformation of vacant space at Florida Avenue and Q Streets NW into mostly familysized affordable housing. A June 19 workshop by the DC Department of Consumer and Regulatory Affairs (DCRA) on information and guidance on property rentals, housing complaints, vacant properties, landlord rights, and vacant property taxes. A June 20 conservation project with Casey Trees under DHCD’s Vacant to Vibrant DC. June 6 and 20 DC Open Doors Homebuyers’ Informational Seminars by the DC Housing Finance Agency (DCHFA). A June 21 Homeownership Course Commencement Program by the DC Housing Authority (DCHA). A June 23 DCHFA Lender’s Fair. Look for upcoming announcements on DHCDs request for proposals (RFP) process for affordable housing projects—to include the Fall 2017 awardees and the opening of the next application period—and more!

Get updates at https://dhcd.dc.gov/page/2018-june-housing-bloom

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Making a House into a Home

Noteworthy Books on Designing, Repairing, and Purchasing Homes By Ronda Smith Special to the Informer

Dare to Repair: A Do-It-Herself Guide to Fixing (Almost) Anything in the Home By Julie Sussman This is not your father’s home repair book! It’s not your husband’s, your brother’s, your boyfriend’s, or the guy’s next door. Dare to Repair is a do-it-herself book for every woman who would rather be

self-reliant than rely on a super or contractor. No matter the depth of your pockets or the size of your home, a toilet will get clogged, a circuit breaker will trip, and a smoke detector will stop working. It’s up to you how you’ll deal with them -- live in denial, pay the piper, or get real and do it yourself. Dare to Repair demystifies these home repairs by providing information that other books leave out. In Dare to Repair, you’ll learn how to: fix everything from leaky faucets and refrigerator gaskets to cleaning gutters and replacing broken windows. This book is chocked full of detailed illustrations and “provides even the most repair-challenged woman with the ability to successfully fix things around the home.”

This is not your father’s home repair book!

Home Buying by the Experts: How to Make Your Dream Home a Reality By Brian Yui Throughout the book, real estate experts reveal the inside scoop on home-buying in this market. Whether you’re a first-time buyer or seasoned veteran, get practical, stepby-step advice from planning your home purchase to moving into the

home of your dreams. Heavyweight contributors include best-selling authors Robert G. Allen and Brian Tracy, Quicken Loans CEO William Emerson, and the “Dear Abby of real estate” Bob Bruss. They’re joined by other industry-leading authorities who give homebuyers an in-depth look at each step of the buying process. Chapters – each written by an expert in their field – offer practical advice on assessing home buying potential, choosing the right home, mortgages and insurance, creative financing, successful negotiating, home inspections, contracts and closing, personal and financial goal-setting, moving, and tax deductions.

100 Questions Every FirstTime Home Buyer Should Ask By Ilyce R. Glink Ilyce R. Glink has established herself as America’s most trusted real estate expert. In this new, fully revised and updated edition of the book that made her a household name, Glink offers more than 100 pages of new material addressing all of the current trends home buyers need to stay on top of, including: the new construction housing boom and how home buyers can make the most of it; mortgage lending innovations, such as interest-only financing and the ability to finance 103 percent of the purchase price; and the changing habits of first-time home buyers (purchasing without a broker, using discount Internet-based services, and buying first homes as investments). 100 Questions Every First-Time Home Buyer Should Ask, Glink presents new stories of real people who have gone through the home-buying process for the first time and once again offers her trademark friendly advice on how to avoid common home-buyer mistakes. HS

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District Offers a Variety of Assistance for Homebuyers By Stacy M. Brown WI Senior Writer The start of the new home buying season has arrived, but experts say if prospective home buyers don’t prepare properly, they could be in for an agonizing search. Across the country, many housing markets are seeing a record low number of homes up for sale thanks to fewer existing homeowners opting to move and home builders constructing fewer new homes, according to MarketWatch. Tight housing inventory is, in turn, fueling rapid appreciation in home prices, all while mortgage rates have generally increased at a steady clip. Not only is that making it less affordable to buy a home for many Americans, it’s also making home purchase process more stressful. This year, perhaps more than ever before, prospective home buyers need to prepare, MarketWatch reported. However, things are a bit different in the nation’s capital where

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first-time homebuyers in the District have a plethora of services that should make owning a new home easier than in most cities. District housing officials said the programs, which include those that could cover expensive down payments and closing costs, have been designed with the idea of not only keeping families in the city, but attracting others to the ever-growing nation’s capital. “DC is doing so much to encourage homeownership, especially East of the River,” said Polly Donaldson, the director of the DC Department of Housing and Community Development (DHCD). “We want to make sure that there are more opportunities for residents to get ready to purchase their homes,” said Donaldson, whose served as director since 2015 and manages an operating budget of more than $250 million to preserve and produce rental and homeownership opportunities for District residents. Among the programs residents have an opportunity to participate

in is the Home Purchase Assistance Program (HPAP), which provides interest-free loans and closing cost assistance for those seeking single family homes, condominiums or co-op units. As of last year, eligible applicants can receive as much as $80,000 in gap financing assistance and an additional $4,000 in closing cost assistance. The program has a zero percent interest loan for those with incomes below 80 percent of the area median income, which is deferred until the property is sold, refinanced to take out equity, or is no longer the homeowners’ primary residence. Under the program, moderate-income borrowers who earn between 80 percent and 110 percent of the area median income will have payments deferred for five years with a 40-year principal-only repayment period. The maximum first trust loan amount cannot exceed $417,000, the conventional conforming loan limit. In May 2013, DC’s Housing

Finance Agency (DCHFA) restructured its previous DC Bonds program for new first-time homebuyer assistance program named “DC Open Doors.” The program has now issued down payments for over $200 million in city homes. It’s also more accessible to those working in the District who wish to live downtown and strives to eliminate the biggest obstacle to purchasing a home in DC – the down payment. “One of the biggest barriers to buying a home is coming up with the down payment and saving for those closing costs,” said DCHFA Executive Director and CEO Todd A. Lee, who joined the agency in 2016 after more than 20 years in the field of multifamily and commercial real estate finance. “In the ‘DC Open Doors’ program, you don’t need to be a firsttime homebuyer and you don’t have to be a current resident of the District,” Lee said. When asked whether potential homebuyers faced any new federal or local regulations in 2018, Lee said there were none. “Our team tries to do good job of promoting all of our homebuying financial products, so I’m not sure if there’s any particular product or program I would say folks may not know about, but I will go through all of them because I will not miss an opportunity to re-promote each and every program that we do.” he said. Another offering available to residents is the Mortgage Credit Certificate program, an incentive for home purchasing in the District that provides qualified buyers with the ability to claim a large tax credit. “A tax credit is more beneficial because it puts money in your pocket,” Lee said. “You can count it toward your income when qualifying for your mortgage and it could allow a potential homebuyer to purchase a little bit more.” The program provides qualified

THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018 / www.washingtoninformer.com

borrowers the ability to claim a federal tax credit of 20 percent of the mortgage interest paid during each calendar year. “I think the tide is turning on homebuyer assistance … we are in growth mode and we have to make sure that we’re putting our resources there for longtime residents and knowing that folks also are coming here,” Donaldson said. “I think maybe people aren’t as aware of the resources and some might not think they’re eligible when they are. It’s about being proactive, and the mayor has been clear about it, so you must be very intentional. We say we want to see more homeownership, so there’s more down payment assistance,” Donaldson said. Both Lee and Donaldson each emphasized at least one other District program homebuyers should consider: DC’s Roots to Roofs program. In announcing that program two years ago, Mayor Muriel Bowser said “Roots to Roofs” highlight would celebrate residents who proudly have put their roots down in the District for generations – or those want to in the future. The mayor said as the economy grows, city officials wanted to ensure that every resident —regardless of color, background, or zip code— can live in the District. The Roots to Roof website — www.rootstoroofsdc.com — lists a host of housing programs in the District including a link to search for housing by type and price; loans and closing costs assistance; loans and down payment assistance; programs for District government employees; current homeowner financing assistance; rental housing solutions; and housing repairs and updates. “My recommendations would be that potential homebuyers visit community-based organizations which are on our website,” Lee said. “Reach out to them to begin the process of educating yourself.” HS

Making the Down Payment Possible

By Kevin Newton Senior Loan Officer, George Mason Mortgage, LLC

While homeownership may be the norm in many communities, for many African Americans, it seems like a distant dream. African Americans households are still far less likely than white households to own their home and for many who do, they are the family’s first generation to realize the benefits of homeownership. According to United States Census Bureau, 42.2% of black householders owned their home in the first quarter of 2018 while 74.4% of Non-Hispanic Whites did during the same pe-

riod. Although there are hurdles to overcome, purchasing a home is possible, but we need the right information, access to affordable loans, and a knowledgeable lender to guide us through the process. Saving for a down payment is often one of the largest hurdles in homeownership and since persistent income disparities between minorities and whites remain, the time it takes minorities to save the down payment could be years if not decades longer than white households. In ad-

dition, many African American potential homeowners believe they need 20% of the purchase price for the down payment, which is not true. Although there are benefits to putting 20% down, including potentially lower interest rates and avoiding private mortgage insurance (PMI), there are a number of government programs with down payments as low as 3%. Many of these programs have flexible qualifying guidelines with credit score guidelines as low as 620, various options in mortgage insurance, and options with debtto-income ratio as high as 50%. In addition, there are a number of grant opportunities that assist with down payment and closing costs if you are a first-time buyer or have not owned a home in the last three years. Below are a few of the grant and loan programs that help people realize the dream of homeownership. Each program has its own guidelines for participation and the grant programs often have limited funds to gift. • DC Open Doors-Offers qualified buyers home purchase loans and down payment assistance. • Virginia Housing Development Authority, VHDA-Helps Virginians purchase homes with a number of loan programs tailored for first-time homebuyers and homeowners who want to buy in Areas of Economic Opportunity.

• Fannie Mae Home Ready 3% Down payment-Designed for creditworthy low- to moderate-income borrowers, expands eligibility for financing homes in low-income communities. • Freddie Mac Home Possible 3% Down payment-Offers low down payments for low-to moderate-income homebuyers or buyers in high-cost or underserved communities. • Maryland Mortgage Program, MMP -Provides homebuyer assistance programs by offering mortgage loans, down payment, and closing cost assistance, among other benefits, to eligible homebuyers with lowand- moderate income. • Home Purchase Assistance Program, HPAP – Provides interest-free loans and closing cost assistance to qualified applicants to purchase single-family houses, condominiums, or cooperative units. • Maryland Mortgage Program, MMP 4% and 6% Grants -Provides homebuyer assistance programs by offering mortgage loans, down payment, and closing cost assistance, among other benefits, to eligible homebuyers with low-and- moderate income. I am proud to represent George Mason Mortgage as it continues to provide education and a wide range of loan products that help minorities realize the dream of homeownership, affecting the legacy we leave our next generation. HS

HOMEOWNERSHIP IS EASIER THAN YOU THINK “Although there are hurdles to overcome,

George Mason Mortgage LLC offers customized loan solutions for first-time homebuyers like you.

purchasing a home is possible, but we need

● Low or no down payment options ● Flexible credit requirements ● Affordable payments

Receive a free pre-qualification AND a home appraisal by providing the code WI3 when applying for your home loan with George Mason Mortgage, LLC.* *To be eligible for this special incentive, your loan must close with George Mason Mortgage, LLC. Offer expires September 30, 2018.

GMM has offices across the greater DC and Baltimore metro region. To find a Loan Officer in your area, please call 703-273-2600 or visit our website at www.gmmllc.com

ADVERTISING NOTICE – NOT A COMMITMENT TO LEND – SUBJECT TO PROGRAM AVAILABILITY. This is not a commitment to lend. All loan applications are subject to credit and property approval. Annual Percentage Rate (APR), programs, rates, fees, closing costs, terms and conditions are subject to change without notice and may vary depending upon credit history and transaction specifics. Other closing costs may be necessary. Flood and/or property hazard insurance may be required. To be eligible, buyer must meet minimum down payment, underwriting and program guidelines. George Mason Mortgage's NMLS ID is 153400.

the right information, access to affordable loans and a knowledgeable lender to guide us through the process.”

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A NATIONALLY RECOGNIZED LENDER WITH A DEDICATED PRESENCE IN YOUR LOCAL COMMUNITY Your dream of homeownership may be closer than you think. ● Wide variety of loan programs including

First Time Homebuyer programs ● In-house Underwriting, Processing

and Closing

Receive a free pre-qualification AND a home appraisal by providing the code W I1 when applying for your home loan with George Mason Mortgage, LLC.* *To be eligible for this special incentive, your loan must close with George Mason Mortgage, LLC. Offer expires September 30, 2018.

GMM has offices across the greater DC and Baltimore metro region. To find a Loan Officer in your area, please call 703-273-2600 or visit our website at www.gmmllc.com

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Become Homeowner Ready Purchasing a home can be one of the most exciting and financially rewarding investments you make in your lifetime. Although the mortgage process may seem confusing, it does not have to be. Being approved for a mortgage often comes down to three things: Credit, Cash and Income.

CREDIT

By Chiori Brewer Branch Manager, George Mason Mortgage, LLC

A credit score is a number that represents how likely you are to repay debt. Your credit score determines if you qualify for a loan, and sometimes your interest rate and how much you are able to borrow. All mortgage loan programs have credit

score requirements. For example, in some cases, borrowers applying for a FHA loan can have a credit score as low as 580, and with a Conventional loan, as low as 620. If you are looking to improve your credit score, work to pay down your credit card balances and make all your payments on time, and do not apply for or open any new credit, or close out existing accounts. Do not let credit concerns stop you from learning about your options. Review your credit report in detail with a mortgage loan officer. You can receive a free copy of your credit report at annualcreditreport. com.

HOMEOWNERSHIP IS EASIER THAN YOU THINK George Mason Mortgage LLC offers customized loan solutions for first-time homebuyers like you. ● Low or no down payment options ● Flexible credit requirements ● Affordable payments

GMM has offices across the greater DC and Baltimore metro region. To find a Loan Officer in your area, please call 703-273-2600 or visit our website at www.gmmllc.com

CASH

No, you do not have to put 20% down to finance your new home, but you will need cash at settlement to cover the closing costs and your down payment. Closing costs can run between 3% and 5% of your home’s sales price. Closing costs often include an appraisal fee, attorney fees, title insurance, taxes, transfer taxes and fees the mortgage company charges to originate your loan. These fees are, in part, dependent on the state and county you settle in and the mortgage company you work with. The cash you will need for your down payment will depend on the loan program you choose, and typically runs between 3% and 20% of your home’s sales price. Going with the lowest down payment may not always be in your best interest. The down payment amount can affect your interest rate and determine whether or not private mortgage insurance (PMI) is needed on your loan. In most cases, PMI is needed for any loan that accounts for more than 80% of the home’s sales price. However, there are options to avoid PMI even if you put less than 20% down. If you are VA eligible (current or former military service person), or USDA eligible (purchasing in a rural development area), you could have access to 100% mortgage financing. In either case, there is no down payment required though closing costs will be required. Your down payment can come from several sources including your personal savings (e.g., checking, savings, investment, retirement accounts, etc.), gifts from close relatives, sale proceeds (e.g., from your car, boat, previous home, etc.), employer bonus, or down payment assistance

and grants from government or local non-profit agency programs. You do have to prove where the down payment comes from, so money saved at home or that cannot be traced to its source is unacceptable.

INCOME

Lenders calculate your debt-to-income ratio, which is based on your income and monthly debts, to measure your ability to manage your existing bills and potential new mortgage. All loan programs have debt-to-income ratio limits. Lenders generally require a work history of at least 2 years. This work history can come from multiple employers and for individuals just entering the work force, time spent in school, in training or in work required certification programs, may count as well. For self-employed, commissioned, part time or seasonal workers, you have to have been in your current position for at least the last 2 years, and your qualifying income is the average earned over the last 2 years.

NEXT STEPS

Once you have determined you have the credit, cash, and income to afford a mortgage, it’s time to get pre-qualified so you know how much house you qualify for… and start your home search! Being pre-qualified for a mortgage means a lender has reviewed your credit along with your income and asset documents, and provides you with a pre-qualification letter. Realtors and home sellers will expect you to be pre-qualified. Be sure to speak to a knowledgeable mortgage loan officer so you can review all potential options and find the one that works best for you and your family. Best of Luck!! HS

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Attracting, Engaging Millennials to the House-Buying Process

A neighborhood in DC’s Historic Shaw neighborhood where many millennials seek homeownership. Photo courtesy Shutterstock

By Dorothy Rowley WI Staff Writer Buying a home for the first time can be a daunting task for young people – many of whom are already faced with a significant amount of student loan debt, are trying to dodge ever-increasing rents, or who are starting families. Nevertheless, millennials including a growing number in the D.C. region, are increasingly motivated toward homeownership. Particularly among those born between 1977 and 1995, an interest in purchasing condominiums and row houses in the Northwest area where the more upscale, revitalized neighborhoods of U Street Corridor and Shaw neighborhoods are located, has blossomed. In such communities, recent housing sales have garnered as much as $112,000 for a 500-square-foot, one-bedroom condo and $1.1 million or more for a renovated, three-story townhouse. LaShawn Channing of Alpharetta, Ga. – a ritzy suburb just outside of Atlanta – has long set her sights on purchasing a rowhouse in D.C., where she sometimes works for weeks at a time. The 32-year-old software sales representative said she wasn’t that surprised to discover the cost of older homes in the District compared to some of the new construction dwellings she’s seen spring up on the outskirts of D.C. “The prices for the kind of house I’d like to buy in D.C.

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-- with at least three bedrooms, three baths and a front porch -- are excessive, to say the least, something like way over $500,000,” said Channing. She said although she pays a little over $1,400 a month rent for her spacious two-bedroom, two-bath Alpharetta apartment, she’s bent on settling in the District. “Each time I come here, I’m reminded how expensive it can be,” Channing said. “But I love D.C. and realize there’s some more spending to cut back on if I’m going to keep saving my money to buy a home in the nation’s capital.” While monthly rents in D.C. can be extremely high – luxury two-bedroom suites in state-of the-art buildings can easily cost $2,100 or more – local real estate agents like Lindsay Dreyer remain optimistic that millennials with good-paying jobs and who love the city’s ambience, will buy homes in or near the area. Dreyer, owner of the sevenyear-old Northwest D.C.-based City Chic Real Estate firm, said however, that many of her peers are surprised to learn their monthly mortgage payments can possibly be less than their current rent. But that’s depending on where they choose in the region to live, she said. “First, in D.C. we’re limited in inventory and there really aren’t enough homes available for sale,” Dreyer, 35, said. “So [along those lines], although the competition can, at

times be fierce, there isn’t a lot of move-in ready homes at affordable prices,” said Dreyer. “Right now, interest rates are on the rise and prices are also still going up, so the monthly payments prospective buyers could afford two months ago are not necessarily the mortgages they can afford today. This makes affordability a big issue for millennials.” Dreyer explained that while prospective buyers tend to have high expectations for what they can get for their money, coming to grips with D.C. as one of the most expensive housing markets in the country, can be an eye-opener. Many have come to the realization that a $350,000 budget, for example, is not going to buy them a lot of house. “So, I think there is definitely frustration in what they will be able to get for their money,” Dreyer said. “They may also think they can get a brand new two-bedroom condo close to a Metro station for $350,000, when that’s not the case. And, that can cause a lot of disappointment.” According to the D.C.-based Center for Economic and Policy Research, local policymakers have been fighting for decades to attract young people to housing in the city’s downtown. While that objective, to a large extent has been accomplished – with more millennials than expected having already moved to neighborhoods in close proximity to Metro stations and their jobs -- the long-term growth of

Lindsay Dreyer /Photo courtesy City Chic

the District’s population and tax base also depends on millennials staying put well into their thirties and forties. The policy center likewise states that while a young couple with a combined income of about $89,000 would have “plenty of great urban-living, one-bedroom options,” when it comes to the need for extra bedrooms to accommodate a growing family, the scenario changes to one that calls for a bigger home and a bigger income. To that end, Dreyer can’t stress enough, the importance of millennials being educated to the house-buying process. To offset obstacles in the homebuying process, Dreyer suggests they do their homework. “Get educated on what financing options are available, and

THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018 / www.washingtoninformer.com

that can be done speaking with real estate agents or mortgage lenders,” she said, emphasizing that in addition to becoming familiar with what’s available in which neighborhoods and communities, millennials should take advantage of workshops and seminars agents and realtors provide for free. By doing so, millennials can begin putting a house-buying plan into action. Making sure one’s credit is up to par is also part of the education process. “That’s very important,” Dreyer said. “And, in dealing with lenders – millennials like everyone else – will go through pre-approval procedures which involve a credit counseling process where credit reports will be pulled and income and asset information obtained.” HS

Homeownership By the Numbers By Ronda Smith Special to the Informer Millennials often bear the weight of stereotypes of their characters as aloof and haphazard, particularly when it comes to spending, savings, and dwelling preferences. For instance, one 2017 report by the Census Bureau suggested millennials relished the freedom of shortterm agreements – opting for rentals, car and bike shares, and communal living, rather than the long-term responsibility of homeownership. But according to Bank of America, millennials are just as likely as their parents and previous generations to want secure homes. In fact, an unstable marketplace, lack of information, and poor planning may be the only harbingers to millennials joining the ranks of America’s homeowners. By the Numbers, this is what the Informer found…

36X

Homeowner’s net worth is 36X greater than that of renter’s.

92,000

In 2015, HUD Housing Counseling helped prevent more than 92,000 foreclosures A new survey by the National Association of Realtors (NAR) and the non-profit American Student Assistance has found only 20 percent of Millennial respondents own a home while carrying a student debt load ($41,200) greater than their annual income ($38,800).

40 Homeownership is important.

40 percent of older millennials (aged 25-34) say they’ve already started to plan for a down payment.

79%

Among millennials who already own a home, 79 percent said their homes are having a positive impact on their long-term financial picture, with 86 percent responding that owning a home is more affordable than renting.

90%

Research done by the National Association of Homebuilders found that more than 90 percent of millennials say they eventually want to buy a house.

We’re here to help first-time homebuyers navigate the mortgage process and make buying a home affordable, even if you have: • Little money for a downpayment • Little or “less-than-perfect” credit history • A recent job change

Millennials want big homes: 2,375 square feet on average, according to the latest National Association of Homebuilders tracking survey, released in March 2016. For baby boomers it’s 1,879 square feet.

57%

To get started, call 1-888-253-0993 or visit mtb.com/mortgage.

2,375

Young people may be taking longer to purchase homes, but a Home Depot study actually found that 57 percent of Millennial renters see home ownership as an important goal, compared to only 38 percent of Gen X and 34 percent of Boomers. In fact, the Harvard Joint Center for Housing Studies predicts that the share of Millennials homeowners will rise to 35 percent this year.

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STEP INTO OUR “BIG” HOUSE. H-19

The Greater Washington Urban League builds financial bridges and creates pathways that spark the dream of homeownership. We aim to inspire individuals to envision the possibilities and empower them to make it a reality.

Housing Services • Free Housing Counseling & Education • Closing Cost & Down Payment Assistance • DC Employer Assisted Housing Program • Emergency Rent & Utility Assistance • Residential Rehabilitation & Weatherization Services • Financial Empowerment Services • Foreclosure Counseling & Mortgage Modification Support • Inclusionary Zoning Classes & Certification • Lead Safe Washington Program Awareness • Affordable Housing Advocacy

Contact us to learn more about our housing services: 202-265-8200 x268 | dthomas@gwul.org | www.gwul.org FOLLOW US ON SOCIAL MEDIA GWUL365 GWUL365

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Homebuying: Move-In Ready Home – or a Fixer-Upper? By Dorothy Rowley WI Staff Writer What if you’re buying a house for the first time, but can’t decide if it should be a brand new (turn-key) house or a charming one with good bones that needs a lot of work? Before you decide which kind of house you want, it’s always best to do your research, which will include the pros and cons of turn-key and fixer-upper properties. Also, don’t forget about property taxes, because depending on where you choose to buy a home, the selection can have a significant impact on the cost to remodel compared to the cost of purchasing a newly-constructed home. Consider that the cost of purchasing a brandnew home can run thousands of dollars more than an older home just in need of some tender, loving care. Overall, whether you move into turn-key home or the worst one on the block, it’s important to recognize which project provides the best fit for the buyer and their budget, and their expectations of the home. Here are some guidelines for choosing either a home in need of repairs or one that’s sparkling brand new: • Move-in ready homes require little, if any work. As soon as you move in, all the work is done, meaning that hopefully, there’s no need to paint, demolish, remove toilets or to be at the ready to provide maintenance; • New owners want their dream home to be perfect and even if it’s hard for the one, two or more parties involved to come to a mutual agreement, there will always be some give

and take to shake hands on; • Depending on choices, such as whether to provide renovations for a house in dire need of repair, a move-in ready home provides little freedom to customize; • Since fixer-uppers always need some form of repair, they can typically be purchased for a fraction of the cost of a movein ready home of a similar size or location. Therefore, if a homebuyer is on the prowl for a bargain or has a tight budget, a fixer upper will be their least expensive purchase option; • While a move-in ready property often lacks originality, charm and character, the work has already been done and the home already designed, whereas a fixer-upper – which can become an expensive, time-consuming project – provides an opportunity to remake the home with everything from flooring and cabinetry to landscaping and windows; • On the other hand, homes that are move-in ready – and can be questionable in terms of quality – are also convenient in that they require next to nothing in terms of renovations and improvements. In most cases, because the new homeowner can comfortably move in without making any changes, turn keys also tend to be more energy efficient because they require less energy to heat during the winter and to cool during the summer: and, • Lastly, because both fixer-uppers and move-in ready homes have their own unique benefits and challenges, it will ultimately be left up to the homebuyer to go with the choice that best aligns with their budget, needs, and longterm goals for their new home. HS

(Fixer-Upper photo courtesy the Shannon Jones Team)

(New House courtesy Whathouse.com)

Overall, whether you move into turn-key home or the worst one on the block, it’s important to recognize which project provides the best fit for the buyer and their budget, and their expectations of the home.

www.washingtoninformer.com / THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018

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Trends in DIY (Do-It-Yourself) Fixer Uppers By Ronda Smith Special to the Informer

Competitive rates. Personal service. Talk to me about your next home loan. If you’re in the market for a home, I can give you a personalized rate quote, help you review your mortgage options, and find a home loan that’s right for you. With Bank of America, you can count on: Low, competitive rates Check out our range of home loan options. Tailored guidance Get information to help you decide how much you can comfortably afford for a home. Online tools and resources Visit bankofamerica.com/downpaymentcenter to search for down payment and cost savings programs.¹ Contact me and tell me about your home financing needs. I’ll make sure you know where you stand every step of the way. Let’s get started today. Michael Albergo Sr. Home Loans Manager NMLS ID: 1217511 301.634.4505 Office michael.albergo@bankofamerica.com https://mortgage.bankofamerica.com/michaelalbergo

1 Down payment and/or closing cost assistance programs may not be available in your area. Down payment and/or closing cost assistance amount may be due upon sale, refinance,

transfer, or repayment of the loan, or if the senior mortgage is assumed during the term of the loan. Some programs require repayment with interest, and borrowers should become fully informed prior to closing. Not all applicants will qualify. Minimum credit scores may apply. Sales price restrictions and income requirements may apply. Homebuyer education may be required. Owner-occupied properties only. Maximum loan amounts may apply. Credit and collateral are subject to approval. Terms and conditions apply. This is not a commitment to lend. Programs, rates, terms and conditions are subject to change without notice. Bank of America, N.A., Member FDIC. l Equal Housing Lender. © 2018 Bank of America Corporation. ARS475RH | AD-03-18-0076.A | HL-110-AD | 03-2018

Because homeownership in the U.S. remains costly due to inflation and gentrification, many house hunters are opting to purchase older, “handyman specials” that require moderate to extensive repairs, rather than newer, ready-to-movein models. And while many homeowners who snatch a fixer-upper gladly outsource the repairs and upgrades to licensed contractors, increased numbers are taking on the jobs themselves. These Do-it-Yourself homeowners have reshaped the Home & Garden industry by bringing their dream homes into fruition through their own hard work – and starkly under budget. In 2013, the value of the global DIY market was approximately 31.9 billion U.S. dollars. In 2014, home improvement stores in the United States generated a revenue that amounted to about 144 billion U.S. dollars. A March 2018 surveys conducted by DIY craftsmen The Carey Brothers, found that 41 percent of Americans will be remodeling this year, second only to interior decorating. Another 35 percent are landscaping, and 25 percent will be gardening, according to the same survey; followed by plumbing and exterior repair jobs at 22 percent. D.C. homeowner Diane Wedge counts herself among the DIY divas who have single-handedly salvaged the home improvement market across the country. The 43-year-old accountant said she grew increasingly frustrated with hiring contractors to do work on her Hillcrest 3-bedroom colonial, that seemed never to be completed. “Most Americans consider themselves to be savvy shop-

pers and informed consumers, but the reality is that some industries require a certain level of trust. When a mechanic tells you that your car requires $1000 worth of work, you assume you’re not being cheated; but you cannot be sure,” Wedge told the Informer. “I wasn’t comfortable in extending that level of trust to plumbing contractors and decided to research the problem and tackle it myself.” Wedge and two of her college friends searched online tutorials, attended a handful of Home Depot classes, and were able to tackle a drainage issue in a matter of hours. “From that moment forward, we realized that with so much information readily available, the only thing keeping us from taking on most of our household repairs was a commitment to doing the work,” Wedge said. In short order Wedge and her friends completed many of the plumbing, electrical, roofing and gutter work, and even backyard deck and landscaping jobs at their homes. Wedge is not alone, as a whopping 75 percent of home repairs, additions, and remodels will be done by the homeowners themselves, with the average overall budget for DIY jobs increased to $3,800, up $1000 from just three years ago. According to Hitwise, a data research company, Fast-rising DIY searches during the month of May included saws and router bits, power and pressure washers, and most predominantly wallpaper. In fact, the DIY audience is 3,773 percent more likely than the average American to search for wallpaper. Baby Boomers, said Hitwise, were among the most significant drivers of the spending on home improvement and their influence on the market is estimated to grow through 2025. HS

www.washingtoninformer.com / THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018

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Explore the District of Columbia Housing Finance Agency’s Homeownership Resources

· DC Open Doors Mortgage Loan ·

Assistance Program NEW Maximum Borrower Income Limit for Conventional and FHA loans is now $140,640 Mortgage Credit Certificate Program NEW Maximum Sales Price Limits are now Non-Target Areas - $625,764 and Target Areas - $764,823

Meet ONE-ON-ONE with lenders and housing counselors to learn how you can qualify to BECOME A HOMEOWNER in the District using DC Open Doors, HPAP, EAHP and/or the Mortgage Credit Certificate Programs.

FIRST and THIRD WEDNESDAY of each month. JUNE 6 and JUNE 20 6:30-8:00 p.m. at DCHFA

DC HOUSING FINANCE AGENCY

815 FLORIDA AVENUE NW WASHINGTON DC 20001-3017 202.777.1600 • www.DCHFA.org • #DCHFAINNOVATES Our strength is in our roots.

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THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018 / www.washingtoninformer.com

Gentrification Brings Massive Change to D.C., U.S. Cities

By Barrington M. Salmon Special to the Informer At gentrification’s height, the phenomenon roared across the District of Columbia with a vengeance, generating the influx of 1,100 new residents a month. Proud Black residents watched as the complexion of their beloved “Chocolate City” shifted from Black to white and multi-ethnic. Meanwhile, long-time native Washingtonians, primarily middle-class residents, and others with more modest means, were pushed out, unable to pay soaring rents and high-priced houses. The city’s out-of-control cost of living spiraled upwards, making affordable housing, for the most part, elusive. Politicians, policymakers, urban planners and experts assess the changes in Washington, D.C. and see great progress. Similarly, some residents welcome the new wave of suburbanization that has brought with it wealthier residents, a broader tax base, skyrocketing prices of homes and other dwellings, and new investments. But the significant differences between Blacks and whites in education, income, wealth accumulation and access to well-paying jobs translates into an inability among many Black residents to afford rent and mortgage payments. Gentrification has also produced tension and lingering resentment between Blacks and whites, old residents and new,

Old-Settlers and newcomers. How best can converging communities live hospitably as One D.C.? According to many the Informer queried: by re-examining the impact of gentrification on long-standing communities. “Gentrification has gone wild in D.C., San Francisco, Portland, Pittsburgh and Atlanta,” said Dr. Derek Hyra, an American University professor and author of three books on gentrification in New York City, Chicago and Washington, D.C., including Race, Class, and Politics in the Cappuccino City. “We also have this ‘back-to-the-city movement of Millennials. In D.C., 52 percent of low-income tracts have been gentrified and the city is second in the nation in terms of gentrification. The 2000 wave has been so intense that Columbia Heights, Shaw, LaDroit have been changed and the wave is moving East. So many neighborhoods have been hit. This isn’t an

issue for one or two communities, it’s one affected the city.” Hyra said he’s very concerned about the disparities based on race, ethnicity and wealth that have been exacerbated by the push of gentrification. “Gentrification should be an integration, not a takeover. D.C. is on one of its best financial footings in a long time. The operating budget this year was $14 billion. The wave is associated with a reduction in crime, parks have been upgraded, libraries have been built, and there’s been an increase in property values. D.C. has grown economically. In the last 15 years, the pie has grown bigger, but income and wealth inequities have also increased.” “It’s clear the money isn’t being distributed more equitably to low-income workers and other residents. We have to work hard to make a just city.” Affordable housing advocate David C. Bowers said the H

Street (Northeast) and U Street (Northwest) corridors, which have been transformed by gentrification, caused a ripple phenomenon of pricing out long-term residents and those with modest incomes, even as about 20 percent of District residents already spend half of every dollar they bring home on housing. “About 30 percent of the population in the city and the region are paying 50 percent of their incomes on rent; and the fair market price for rent in this region has increased by 70 percent over the past 10 years,” said Bowers. “It’s a severe problem. We’ve lost affordable housing units in D.C. and Northern Virginia as rents have increased and incomes have not kept pace.” Gentrification and the massive boon to accommodate the influx of tens of thousands of new residents to the District have fueled a housing shortage for middle and lower-income residents.

At gentrification’s height, the phenomenon roared across the District of Columbia with a vengeance, generating the influx of 1,100 new residents a month.

Those with higher incomes have snapped up houses at such a rate that it has exacerbated the shortage which regional officials and public and private partners are struggling to correct. Bowers said one in five D.C. households now pay more than half of their income towards rent. For families with low and moderate incomes this means that they have little left over each month for basic necessities like transportation and food. It also makes them more likely to be one job loss or illness away from homelessness. Experts, including Moody’s Investors Services, Fitch Ratings, and Standard & Poor’s, attribute the crisis in affordable rental properties to the housing collapse and record foreclosures across the country that began in 2006. Additionally, the growth in renters has worsened an already troubling problem – the inadequate supply of affordable housing. The gap between housing costs and typical worker earnings will continue to grow until or unless more affordable housing becomes available. “Mission has not been accomplished. Millions of people are drowning, struggling to stay afloat,” said Bowers, who likened the affordable housing shortage to a lifeguard saving a few people, while thousands drown. “We need to have to have a greater sense of urgency about those unmet needs and search for creative solutions.” HS

www.washingtoninformer.com / THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018

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Why Homeowner’s Insurance is a Necessity By Ronda Smith Special to the Informer Homeowner’s insurance (also known as home insurance) isn’t a luxury, it’s a necessity. And not just because it protects your home and possessions against damage or theft. Virtually all mortgage companies require borrowers to have insurance coverage for the full or fair value of a property (usually the purchase price) and won’t make a loan or finance a residential real estate transaction without proof of it. According to the Insurance Information Institute, most insurance companies will provide coverage for 50–70% of the amount of insurance you have on the structure

of your home. If your house is insured for $200,000, there would be up to about $140,000 worth of coverage for your possessions. Standard homeowner’s insurance policies provide that the insurer will cover costs related to: erage for that protection. DAMAGE TO THE INTERIOR OR EXTERIOR LOSS OR DAMAGE OF YOUR HOUSE In the event of damage due to TO YOUR PERSONAL fire, hurricanes, lightning, vandal- BELONGINGS ism or other covered disasters, your insurer will offer compensation to manage repairs and replacements. Damage from floods, earthquakes and poor home maintenance is generally not covered and you may require separate riders or line cov-

Clothing, furniture, appliances and most of the other contents of your home are covered if they’re destroyed in an insured disaster. You can even get “off-premises” coverage, so you could file a claim for lost jewelry, for example, even if

you lost it away from home. If you own a lot of high-priced possessions, you may wish to purchase a separate floater policy that insures such items for their full appraised value. Legally speaking, a floater is a type of endorsement that is an amendment to the basic homeowner policy.

PERSONAL LIABILITY FOR DAMAGE OR INJURIES CAUSED BY YOU OR YOUR FAMILY

Liability coverage protects you from lawsuits filed by others. The personal liability coverage within your homeowner’s policy provides coverage for bodily injury and property damage sustained by others for which you or covered residents of your household are legally responsible. For example, if someone falls down your stairs, or your child accidentally throws a ball through a neighbor’s window, breaking an expensive vase, you may be held legally responsible for the damages caused. This includes your pets – and any accidents or injuries they may cause a person inside your home.

HOTEL OR HOUSE RENTAL WHILE YOUR HOME IS BEING REBUILT OR REPAIRED

This part of insurance coverage, known as additional living expenses, would reimburse you for the rent, hotel room, restaurant meals and other incidental costs you incur while waiting for your home to become habitable again in case of flooding, fire, or other disasters that keep you from living in the home. Additionally, those seeking insurance should ask for advice from agents concerning changes in policies based on natural disasters and subsequent addendums to holders. For instance, the District of Columbia had not experienced a noticeable earthquake in decades before the 5.8 tremor shook the city in 2011, so few policyholders had policies that offered protection against earthquake damages. There is now a line provision for earthquakes added to most District policies. Also, check to determine if your house sits in a low-lying area that floods when the Potomac or Anacostia rivers crest and requires flood insurance. Note, these homeowner’s policies are also available to renters. HS

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THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018 / www.washingtoninformer.com

HUD Commemorates Homeownership Month Pushing for a Return to the American Dream By Ronda Smith Special to the Informer June is National Homeownership Month, and the U.S. Department of Housing and Urban Development, using the theme “Find Your Place,” wants all Americans to know that home-

ownership is not only a significant part of the American Dream, but also a largely attainable goal. Since 1934, more than 47 million households purchased a home with mortgage loans insured by the Federal Housing Administration (FHA). During

the housing crisis of a decade ago, the FHA played a critical role in keeping affordable mortgage financing available for millions of qualified borrowers. “Homeownership serves as an enduring symbol of security and prosperity, and it provides many Americans with a legacy they can

First Time Homebuyer

Assistance Program If you are a first-time home buyer, you could be eligible for up to $10,000 in down payment and closing cost toward the purchase of your first home.

Eligible Properties: Any residential property including: 

Resale

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Foreclosure

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Pathway to Purchase is a 0% interest, deferred payment loan. The loan is forgiven after 10 Years!

L o a n Te r m s :

Purchaser must pay back the loan in full when the home is sold, transferred or ceases to be the primary residence of the buyer(s) within the 10-year affordability period. Purchase Price Limits: $307,000 for resale or new construction

For More Information Call: 301-883-5456 Or Visit the Website: www.princegeorgescountymd.gov/865

pass down to their children and grandchildren,” said HUD Secretary Ben Carson. “During National Homeownership Month, we recognize the abiding value of owning a home, and we rededicate ourselves toward helping hard-working families to find their place in the American dream.” Today, home sales are at pre-crisis levels and home prices on the rise in most parts of the country as millennials make up the largest segment of first-time homebuyers. Through FHA and a national network of HUD-approved counseling agencies, HUD is working to make responsible homeownership a reality for millions of Americans. In keeping with the correlation between homeownership and health fused, HUD kicked off its National Healthy Homes Month efforts. Citing homes and health are inextricably linked together, as two reflective components of society that serve as indicators of the strength of the nation, HUD said their efforts should help families create healthier living conditions for themselves and their kids. This year’s theme, Unlocking the Potential of America’s Children: Check Your Home-Protect Your Family, focuses on the opportunity to protect current and future generations of children from the exposures to lead from contaminated paint, dust, and soil. “Making homes safe and healthy involves collaborations among federal and local agencies, residents and community organizations,” says Matt Ammon, Director of HUD’s Office of Lead Hazard Control and Healthy Homes. “During Healthy Homes Month, we’re mobilizing the collective efforts of Federal, State and local health and housing professionals to protect

families where they spend most of their time—in their home, because it’s hard to be healthy when your home is making you sick.” HUD also provides a quick snapshot of the state of both homeownership and how the department is working to promote it in 2018: HUD’s Office of Housing Counseling (OHC) supports a nationwide network of more than 1,800 housing counseling agencies; Struggling homeowners at risk of default who work with a housing counselor are more likely to get a loan modification and are 30 percent less likely to face foreclosure, compared to similar owners who did not get counseled; The median wealth or net worth of a homeowner is nearly $200,000, or 36 times greater that of the median renter who had just over $5,000; Homeowners move far less frequently than renters, making it easier to build community networks and support systems; and Children of families who own their homes are more likely to graduate high school and earn more income later in life. Last year alone, more than 1.2 million people turned to FHA to help them buy a home or to refinance into a lower cost mortgage. Today, an estimated 40 percent of all borrowers turn to FHA to purchase their first home. 44 percent of home purchases by African American families and 43 percent of home purchases by Hispanic families are assisted by FHA. HS

www.washingtoninformer.com / THE WASHINGTON INFORMER HOMEOWNERSHIP SUPPLEMENT – JUNE 2018

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Receive a free pre-qualification AND a home appraisal by providing the code WI2 when applying for your home loan with George Mason Mortgage, LLC.* *To be eligible for this special incentive, your loan must close with George Mason Mortgage, LLC. Offer expires September 30, 2018.

GMM has offices across the greater DC and Baltimore metro region. To find a Loan Officer in your area, please call 703-273-2600 or visit our website at www.gmmllc.com

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Dedicated to advancing homeownership

Homeownership is an important step in creating financial stability for individuals and communities. We’re committed to enabling and advancing sustainable homeownership through financing more homes, supporting and providing financial education. Call, stop by, or click today! 1-800-771-3476 202-895-5150 4926 Wisconsin Ave. N.W. Washington, D.C. 20016 www.wfhm.com/dc-washingtondcbranch-washington

Count on us to provide: Extensive home financing options to meet the needs of more homebuyers Homebuyer education resources both online or in-person Career opportunities to expand skills and advance careers

Relevant military experience is considered for veterans and transitioning service men and women. Wells Fargo is an Affirmative Action and Equal Opportunity Employer, Minority/Female/Disabled/Veteran/Gender Identity/Sexual Orientation. Information is accurate as of date of printing and is subject to change without notice. Wells Fargo Home Mortgage is a division of Wells Fargo Bank, N.A. © 2017 Wells Fargo Bank, N.A. All rights reserved. NMLSR ID 399801. AS4423179 Expires 03/2019

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