PROVIDENCE – The state’s housing agency is launching a pilot program on Wednesday that is geared toward aiding homeownership in the neediest communities.
The program, FirstGenHomeRI, offers $25,000 for down payment assistance and closing costs for prospective first-generation homebuyers. The aim of the program – to be overseen by the R.I. Housing and Mortgage Finance Corp. – is to address inequities and barriers faced by families that have historically not pursued homeownership, according to an announcement from Gov. Daniel J. McKee’s office.
“Down payment assistance programs targeted at opening doors to homeownership for first-generation buyers can help reduce the racial wealth gap and are a down payment on our future: the future of Rhode Island families and their ability to live and thrive in our state,” McKee said in a news release.
The down payment assistance is a grant that does not need to be repaid if the homeowner keeps their home as their primary residence for at least five years, according to the release.
Eligible homebuyers must be first-generation and ﬁrst-time homebuyers purchasing a one- to four-family home or condominium in Rhode Island, meet loan, income and credit score guidelines and must live in the home as their primary residence, the release stated.
Participants will receive HUD-approved homebuyer education from community partners to ensure they are prepared for the responsibilities of homeownership and can be successful homeowners, the release explained.
Eligible communities are those with the highest levels of need for homeownership, with eligibility determined by factors such as income, the median housing costs, and household size, with consideration given to minority populations that have a higher percentage of median incomes below 80%, according to the release.
Communities of focus for the program include Central Falls, East Providence, Pawtucket, Woonsocket, and parts of Providence and Newport.
“First-generation homebuyers deserve the opportunity to put down roots in Rhode Island and benefit from the stability owning a home can provide,” Lt. Gov. Sabina Matos said in the news release. “I’m honored to stand with Governor McKee as we make this announcement and support an effort that addresses the inequities and barriers to homeownership that exist for low-income and minority communities.”
Newly hired Deputy Secretary of Commerce for Housing Joshua Saal said the program can help make homeownership a reality for families that historically have been denied opportunities to build wealth and achieve economic stability through housing.
“Homeownership is a pivotal step towards wealth building, and it is especially impactful when we can advance equity in our state,” he said. “I commend R.I. Housing on [its] leadership on this important program as we continue to roll out additional housing supports in the near future.”
Carol Ventura, executive director of the R.I. Housing, said the barriers to homeownership exist for many low-income and minority borrowers.
“It becomes especially true for first-generation homebuyers,” Ventura said. “Traditionally, these borrowers compete with peers who may be able to tap into family resources to purchase a home and who benefit from the lived experience that comes from growing up in a home your family owns rather than an apartment.”
Studies show that when parents own a home, their children are more likely to own a home. The resulting wealth and stability that comes from owning a home can open opportunities for homeowners, their children, and future generations.
Details and information on how to apply is available online at www.rihousing.com/FirstGenHomeRI.
Cassius Shuman is a PBN staff writer. Contact him at Shuman@PBN.com. You may also follow him on Twitter @CassiusShuman.