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Housing stimulus; 100 years of diversity gap; NCRC Fair Lending 😄

By March 15, 2021 No Comments

The stimulus passed, now what does that mean for housing?

Last week President Joe Biden signed the $1.9 trillion economic stimulus package into law. Among other things, the package will ensure many Americans receive $1,400 individual payments. 

This in itself could affect the housing industry indirectly. We talked about the surging home prices on Friday. With a family of four eligible to receive up to $5,600 with this round of stimulus checks, it could help some afford a down payment for a home even as prices continue to surge. It could also help many who have fallen into forbearance to begin planning their exit strategies. 

But the stimulus does also include several housing-specific assistance. Some Americans could receive financial assistance for rent, utilities and other house-related expenses. Those who make less than 80% of the area median income are eligible for the housing assistance. 

Another $10 billion will go toward helping homeowners struggling with mortgage payments and $100 million will go toward housing counseling. The stimulus gives $5 billion for fighting homelessness and $5 billion for emergency housing vouchers.

“MBA commends the passage of the American Rescue Plan Act of 2021, by both the Senate and House, which will deliver essential relief to millions of individuals and families affected by the COVID-19 pandemic,” said Robert Broeksmit, Mortgage Bankers Association president and CEO. “Specifically, we appreciate the bill’s provisions that provide additional assistance to tenants, homeowners and businesses – particularly those in the retail and hospitality sectors. We look forward to continuing to work with Congress, policymakers and other stakeholders on ways to help consumers and strengthen the overall housing and rental markets. MBA now calls on President Biden to quickly sign this bill into law.”

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Housing will take 114 years to close the diversity gap

Let’s face it – we all know the housing industry is not a diverse place to work. And new research from Fannie Maeshows it could take 114 years to close that diversity gap in the housing industry’s workforce. 

The contrast is not short of shocking: From 2000 to 2019, the housing industry workforce increased by 66%, yet the representation of Hispanic or Latino and Blacks only increased by 5% and 1.98%, respectively, Fannie Mae’s report says.

“While the country is rapidly becoming more diverse, the housing industry is not,” Fannie Mae stated. “And it is imperative that the industry reflect the country it serves to more effectively address the inequities that have disadvantaged far too many.”

According to statistics compiled by the Brookings Institute, as of 2019, Whites, Hispanic or Latino, Blacks and Asian Americans currently represent 60.1%, 18.5%, 12.5% and 5.9% of the U.S. population, respectively. In comparison, the housing industry is 71.6% White, while Hispanic or Latino, Blacks, and Asian Americans represent 9.1%, 7.5%, and 9.4%, respectively.

The report shows that if the housing industry does nothing, and trends continue at their current rate, it will take 114 years for the industry to mirror the diversity in the U.S.

The task may seem daunting, but some companies are already working toward making a change such as Fannie Mae’s Future Housing Leaders program, which is a tool the housing industry can use to diversify their organization.

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NCRC informing lenders on local patterns

The National Community Reinvestment Coalition says it is important for lenders to explore local lending patterns, and is creating a tool to help. They call it the Fair Lending Report

“Using the most current data available, you can examine how lenders perform in lending to low- and moderate-income communities and to people of color,” said Jason Richardson, NCRC director of research and evaluation. “This information arms our members with the data they need to best advocate for their communities.”

The interactive tool uses data lenders are required to report under the Home Mortgage Disclosure Act, small business lending data, bank branch locations and U.S. Census Bureau data. It uses the data to help people father insights about lending and bank networks, detect patterns of disinvestment and compare the performance of lenders in any community. 

“Data is essential for our members to understand the lending landscape and institutions in their communities, and this new tool gives them easy and instant access to a detailed report,” NCRC CEO Jesse Van Tol said. “The tool also illustrates why we advocate for policies to ensure lenders provide detailed data about their loans. The data tells a story, not only about which lenders are doing the most for their communities, but also about which communities are most in need of capital from lenders who could do more.”

disproportionately by this “she-cession” are much less likely to have been house hunting in the first place,” First American said. 

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