Interested in Home Ownership? Here’s a Program You Should Know About

While NYC may be known for sky-high rent and ultra-competitive housing lottery programs with extensive waitlists, one nonprofit organization is working to help lower-income residents achieve their dreams of homeownership. 

The Neighborhood Assistance Corporation of America, also known as NACA, seeks to combat predatory lending and help underserved, low-to-moderate income communities build generational wealth through access to affordable mortgages and financial assistance. Today they claim a track record of having helped over 75,000 successful homebuyers—90% of whom are people of color. 

If you’re ready to pursue your dream of homeownership, here’s an overview of how NACA’s Home Purchase Program might be able to help.

What is NACA’s Home Purchase Program?

NACA’s Home Purchase Program (HPP) provides a path to homeownership through free training and an affordable housing contract which features no down payment, no closing costs, no Private Mortgage Insurance (PMI), no fees, and a below-market fixed rate. HPP is available to anyone who has a social security number or a work visa. C8 designates however are not eligible. 

The program requires a multi-step process, including attendance at a four-hour in-person or online Homebuyer Workshop that outlines the Home Purchase Program requirements in detail and provides an overview of the homebuying procedures. 

You can read more and sign up for the homebuyer workshop online.

In-person workshops are offered at various locations throughout New York City, and they are typically held on Saturdays. The online sessions are self-paced and can be completed at your convenience.

After attending the workshop, participants must schedule an appointment through the member portal with a NACA Housing Counselor to review finances, gather documents and establish a monthly mortgage payment that they can afford.

Once your Housing Counselor determines that you’re ready based on your financial habits and assets, you are guided through a property search, and are eligible for “NACA’s Best in America Mortgage” which can help you seal the deal on the home.

Do I need to have a good credit score to be eligible?

NACA’s HPP does not consider a person’s credit score. Instead, it offers a character-based loan product, considering elements such as a history of on-time rental payments, stable income, and the ability to build savings.

What are the benefits of this program?

The NACA Home Purchase Program is an avenue for minority and low-income buyers to realize their dream of homeownership, without the hassle of multiple financial barriers that would otherwise exist, such as exorbitant fees, a hefty downpayment cost upfront and restrictive underwriting based on credit score.

Participants can buy a single-family home, condo, co-op or multi-family property (up to 4 units) as long as the home becomes their primary residence. 

HPP provides a mortgage at a fixed interest rate that is below average, with 30-year, 20-year or 15-year terms. The mortgage contract does not require a down payment on the home, there are no “closing costs” and no private mortgage insurance fees.

In other mortgage arrangements, foregoing closing costs can mean there will be a higher interest rate or other charges. For the NACA Mortgage, often called “America’s Best Mortgage,” all closing costs — including appraisal, title and fees — are paid for. 

NACA’s Home Purchase Program: Step-by-step

Step one: Attend a free homebuyer workshop locally or online.

Step two: Receive a NACA ID via email three business days later–simply for successfully completing the workshop requirement. Use your NACA ID to log in to your new NACA member account and upload your relevant financial documents like tax forms and proof of income. 

Step three: Meet with a NACA Housing Counselor to discuss your financial situation and create a plan of action to achieve NACA Qualification: a letter certifying your readiness to purchase a home. The amount of time it takes to get NACA Qualified varies depending on an individual’s income and expenses. The Housing Counselor will monitor your ability to maintain a steady comprehensive budget until you become NACA Qualified and can begin searching for your dream home.

Step four: Meet with a NACA Buyer Agent who helps with the process of searching for a property, negotiating terms, and signing the final agreement–which will include NACA’s favorable mortgage terms. You’ll have six months to find a property you want to buy, after which your NACA qualification will expire and you will need to re-qualify.

Who is eligible for this program?

US citizens and immigrants who have a social security number, or those with work visas–except the CO8 visa–are able to apply for this program.

NACA accepts participants who are either low-to-moderate earners, called Priority Members, or those with an income greater than the median income of the neighborhood they want to purchase in, who are called Non-Priority Members. Priority members can purchase a home in any area. All members must pay an annual $36 membership fee while they are in the program.

The income limits are defined by the Metropolitan Statistical Area (“MSA”) of the neighborhood, with the median income for New York City neighborhoods being $100,000. 

Find out what your neighborhood’s median income is, here.

There are a few additional requirements, outlined below:

1. No member of the household can have an ownership interest in any other property at the time of closing on a property through NACA.
2. The homebuyer must occupy the purchased space for the life of the loan.
3. The homebuyer is expected to participate in five economic justice-related actions/activities a year, including at least one prior to NACA Qualification and one prior to closing on the house. These can range from attending community events to helping register people to vote 
4. The homebuyer must be willing to abide by NACA’s terms of membership, participation and eligibility.