EQUITY Profile of the Month
Sometimes, changing your own economic expectations is a matter of being in the right place at the right time.
Jamie definitely did not have asset building on her mind when she walked into the ballroom at the hotel for an afternoon seminar. She arrived early, as the presentation on stem cell research, her topic of interest, was the second presentation scheduled. Unfortunately, the conference was running late, as they sometimes do, and as she watched a soporific raffle take place, she realized that the first presentation hadn't even begun. Anticipating boredom, she took a seat and waited.
That first presentation turned out to be on asset building for people with disabilities. Jamie was not particularly interested in the topic, but she casually listened as the presenter introduced financial literacy, the earned income tax credit, and individual development accounts. As one program was blended and braided with the next, then again with the next, she started to take more interest. Much of the discussion revolved around ways in which a person could participate in these programs without threatening their benefits. Jamie had been working since high school, and it had been several years since she worried about the restrictive rules around SSI or Medicaid. She wished she had heard of such programs when she was just starting out. It was probably too late for her now, though.
The speaker continued on enthusiastically, blending in yet another concept—this time about home ownership for people with disabilities, and programs such as Section 8. Jamie laughed to herself; she lives in Northern California, where property costs are astronomical. She did not know of any families with disabilities buying their own home, much less a single woman with a disability! Besides, she probably didn’t qualify for any of these programs anyway.
She started to think about her recent forays into the rental market. She needed to find a new place to live that would accept her beloved Bernese mountain dog, Max. Apartment costs were bad enough, but trying to find a clean, safe building that allowed large pets was proving rather difficult. She found one place, but the four-hundred square foot studio was renting for $1500 per month, and that was considered a bargain.
The presenter pushed on, now discussing mortgages, and there it was, the first “a-ha!” moment: A mortgage for people with disabilities who wanted to be first time homeowners? A four percent, thirty-year fixed-rate mortgage, at that? Minimal down payments and closing cost? Apparently, such a program existed for Californian’s with disabilities. True, the Home Choice Mortgage had been temporarily suspended due to the state’s inability to settle on a budget, but confidence was high that the funding would soon be restored. The presenter demonstrated how the four percent interest significantly lowered the cost of the loan. Based on a $200,000 mortgage, the four percent loan had a monthly payment of about $950, while a traditional 30-year fixed-rate mortgage would have a monthly payment of $1,350.
The presenter quickly explained several other programs designed to assist first-time home purchasers, including those with a $50,000 down payment assistance, an additional $25,000 down payment loan from the local municipality, and a program that forgives a percentage of your loan under certain circumstances.
Jamie was stunned; apparently, some programs did apply to her. She tried to slowly let the information sink in, but she was getting excited. Immediately following the close of the asset building presentation, she cornered the presenter before he had time to return to his seat in the back of the ballroom.
Was it true? Could someone with a disability really blend these programs together? Could she really own her own home? She briefly explained her situation, and received the contact information of a local realtor specializing in these kinds of transactions.
As it turns out, it is all true. People with disabilities can blend these programs together; it usually comes down to three simple factors:
- Access to the information,
- referral to people who can make it happen,
- and, most importantly, choosing to make a difference in your own life.
Without even realizing it, Jamie had started this process several years prior. She had read a personal finance book to start making better financial decisions. She also started saving money from each paycheck and contributing to her employer’s 403(b). Perhaps most importantly, though, Jamie started building a credit history.
By the time she met with the realtor, Jamie’s credit score had risen to the high six hundreds, making it much easier to qualify for many of the above-mentioned programs. “It just never occurred to me that as a single woman with a disability, I could ever own my own home,” Jamie said a few days after the asset building seminar.
However, own her home she shall. Even though Jamie will have to pay more per month for her home than she would for that four hundred foot apartment, the interest on the loan for her house, the state and local property taxes, and a myriad of other items will become deductable on her income tax.
For Jamie, the autonomy of having a place of her own is the greatest asset. “No one can ever tell me what to do with my own home, and no one can tell me I can’t have Max.”