Royal Credit Union’s CDFI program helps first-time home buyers
Wednesday, April 19, 2017
Royal Credit Union (April 19, 2017) - Diana had always dreamed of owning a home. She works full-time and has a solid credit score, but a very limited credit history. She also faced a barrier common to many first-time home buyers, especially those with lower income - difficulty saving for a down payment.
A longtime Member, Diana partnered with Jared Johnson, an officer in Royal Credit Union’s home loan department, to review options. Fortunately, through the Community Development Financial Institution program, the credit union created a home loan product with a low 3 percent down payment (far lower than the typical 20 percent).
“Royal Credit Union’s CDFI program offers an affordable monthly payment and minimal down payment—something that is hard to find in a home loan product,” noted Matt Gerber, Vice President of Mortgage Loan Sales.
Diana was able to secure her first-ever mortgage and her house payment is now under $500 a month - which saved her money over her previous rental. Her story reflects national and regional trends. In the U.S. market, buying a home is typically more affordable than renting (ATTOM Data Solutions, 2017).
“As a lender, it’s so rewarding to be able to offer opportunities to more Members. I’m proud to be able to make a difference,” said Jared Johnson, Mortgage Loan Officer.
The power of the CDFI certification and grant made a big difference in Diana’s life as it does in so many others. Royal provides home loans to low-income individuals and consumer lending (like auto loans and small dollar unsecured loans) through their CDFI program. In 2016, Royal leveraged CDFI grant funds 50:1 ($500,000 loan loss reserve grant funds to $25 million in loans).
Royal is one of only six certified CDFI credit unions in Wisconsin and Minnesota. Learn more about how CDFI credit unions serve low-income communities across the United States.