Five mortgages for Black and Brown Folk
I’m going to go way out on a limb here, disregard my professional and educational training in psychology and finance, and do the unthinkable: give a rule of thumb. This is my list of five mortgages Black and Brown Folk in the United States should know. This list is by no means inclusive—I’ve dedicated a whole website to discussing all the financing options and history of mortgages for Black and Brown Folk—but let’s go out on a limb and, with the caveats generally, for most people, without hearing your story, If I had to say, etc., these would be my top choices.
“Negroes and Whites don’t mix. If we brought them into this development, it would depress all of the surrounding property.” Frederick Ecker, President of Real Estate Developer Metropolitan Life on the justification for receiving government subsidies for Whites-only development. From “The Color of Law,” by Richard Rothstein.
We’ll discuss who’s eligible and why these are good choices to decrease historical wealth disparity and build home and property ownership in the Black and Brown community, but here they are.
- Veteran’s Administration Residential Home Mortgage (VA home loan)
- FHA 203(k) Residential Home Mortgage
- VA Interest Rate Reduction Loan Refinance Residential Home Mortgage
- FHA Streamline Refinance Residential Home Mortgage
- Debt Service Credit Ratio Investment Property Mortgage (opens in .pdf)
If you have excellent credit, abundant financial reserves, and, if purchasing an investment property, you have an experienced team and all of the above, I didn’t mean to insult you. These five are for people who have come to me over the last thirty years and said, “Mr. Bossard, I have a few dings on my credit,” or “I need help with downpayment and closing costs,” or even, “We’ve been turned down by three lenders. Can you help us?”
These five would be my go to. Number two, the FHA 203(k), has the added advantage of building wealth for the next generation. I’d love for young people to utilize this one. I was a 203(k) Specialist for one of the nation’s largest mortgage lenders. The stories I have of young teachers, single moms, church folk, etc. who moved into their first home with the equity, sometimes over $100,000, to buy their next home are my favorites.
