Mortgage groups take aim at homeownership gap

Building on an existing program, the Mortgage Bankers Association is spearheading 14 housing industry players, including other trade associations and the government-sponsored enterprises, in a three-year initiative to close the racial homeownership gap.

The program is called the Convergence Collaborative, using the same name MBA has for its work in three cities— Memphis, Tennessee; Columbus, Ohio; and Philadelphia. Plans are for the partnership to spend over $1 million per year during that time.

"The barriers to minority homeownership require a collective effort. In recognition of this challenge, we believe the approach embodied in the Convergence framework can have a greater impact with this new industry partnership," said Bob Broeksmit, the MBA's president and CEO, in a press release. "By working together, we can produce more and faster results that will reduce the racial homeownership gap."

Census Bureau data shows the homeownership rate for white households at 74%, but at only 46% for Black and 49% of Hispanic households.

Besides the MBA, the other industry groups in the Convergence Collaborative are the American Land Title Association; the National Association of Realtors; and U.S. Mortgage Insurers.

Fannie Mae and Freddie Mac are also participants, as well as the following lenders: DHI Mortgage, Fifth Third Bank, Lennar Mortgage, Navy Federal Credit Union, Pulte Financial Services, Taylor Morrison Home Funding and Wells Fargo Home Lending. Navy Federal has been under scrutiny for allegations of bias in mortgage lending, as has Wells Fargo.

During the next three years, the Collaborative will use the existing Convergence network to create a robust "Knowledge Community," to help inform the creation of new and innovative strategies, tactics along with partnerships.

"The housing industry coming together collaboratively is bringing fresh ideas and new approaches to address the homeownership gap in Convergence communities," said ALTA CEO Diane Tomb, whose group is a longstanding partner in the initiative. "As a result, this effort will have a lasting impact on generations of families."

The current Convergence programs use existing tools, both online, such as a down payment assistance finder, and in-person resources, such as homebuyer education courses.

The need is heightened, MBA said, because minorities are expected to make up most of the net new household formations in the next two decades.

"By uniting these leaders from across the industry, we are not only addressing systemic barriers in housing but also fostering lasting change in communities across this country," said Kevin Sears, NAR president. "Together, we can empower aspiring homeowners with the tools and resources they need to achieve the dream of homeownership."