African American Strategy Equitable Access to Homeownership - - PowerPoint PPT Presentation

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African American Strategy Equitable Access to Homeownership - - PowerPoint PPT Presentation

Jun 14, 2023 155 likes •305 views

CON FI DEN T I AL African American Strategy Equitable Access to Homeownership Presentation April 16, 2018 Individual Demographics Age Income (1000s) FICO Total DTI All Debt Student Debt ($) Median Median Median Median Median Median

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CON FI DEN T I AL

African American Strategy Equitable Access to Homeownership Presentation

April 16, 2018

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Individual Demographics

Age Income (1000s) FICO Total DTI All Debt Student Debt ($) Median Median Median Median Median Median Mean Overall 48 64 719 9 4,818 2,987 African-American 45 45 624 10 669 3,757 Hispanic 43 49 678 10 1,113 1,800 New Millennial (19-25) 23 34 670 6 1,752 3,372 Old Millennial (26-35) 30 49 674 11 8,882 6,899 Gen X (36-54) 45 66 697 14 18,489 3,768 Senior (55+) 66 82 779 6 6,300 1,196

» African-Americans and Hispanics tend to be younger than overall population. » African-Americans, Millennials, and Hispanics tend to have lower income and lower credit scores compared to overall population. » The median student loan debt for overall population is zero since majority do not have student debt.

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Note: Credit Bureau data for Sep 2016 to investigate consumers’ credit. Median average values are used. Data combines anonymized individual credit bureau data with marketing data.

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Demographics of Minnesota

Age Income (in thousands $) FICO Score Total DTI Student Loans Median Mean

United States 48 64 719 9 2987 Minnesota 49 75 758 10 3924 Hispanic 40 49 696 10 2524 African American 42 47 666 9 4566 Younger Millennials (19-25) 23 37 700 6 5520 Older Millennials (26-35) 31 57 715 13 9662 Generation X (36-54) 45 82 741 15 4666 Senior (55+) 66 92 807 5 1279

Note: Credit bureau data for Sep 2016 to investigate consumers’ credit. Median average values are used. Data combines anonymized individual credit bureau data with marketing data and is weighted appropriately.

» African-Americans and almost all segments tend to have higher FICO scores in MN.

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What Is Our Definition of “Mortgage Ready”?

Mortgage readiness – Based on research criteria not actual underwriting.

Mortgage Ready

  • FICO score greater

than 620 and…

  • Total DTI ≤ 45%
  • No foreclosures in the

past 84 months

  • No bankruptcies in

the past 84 months

  • No severe

delinquencies (120- 180 DPD) in the past 12 months Mortgage Weak

  • FICO score less than

620 and/or …

  • Total DTI > 45%
  • Foreclosure in the

past 84 months

  • Bankruptcy in the past

84 months

  • Severe delinquency

(120-180 DPD) in the past 12 months

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How Many Are “Mortgage Ready”?

2,737,920 Mortgage Ready African American 36,972,960 Mortgage Ready Total Population 7,860,180 Mortgage Weak African American 41,915,260 Mortgage Weak Total Population

Total Population % African American % Mortgage Weak 39 63 Mortgage Ready 35 22 Mortgage Owner 26 15

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» Of African Americans, 63% are mortgage weak. A 24 percentage gap from total population. » About a third of the mortgage ready group are likely to be homeowners.

Note: Credit bureau data

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Where Do African Americans Live?

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Note: Credit bureau data

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Where Are African American “Mortgage Ready” Individuals Located and Can They Afford It?

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Note: Credit bureau data

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Where Are African “Mortgage Ready” Individuals Located and Can They Afford It? (Close-up)

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Note: Credit bureau data

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Where Are African American “Mortgage Ready” Individuals Located and Can They Afford It? (Counts)

9 CONFIDENTIAL

Note: Credit bureau data

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Where Is Adequate Housing Stock?

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» Looking at the March 2018 time period, there is an overall shortage of housing.

  • Decrease in housing

supply will increase home prices, reducing affordability.

Note: Based on data from Redfin.com for March 2018 to investigate housing stock.

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Where Is Adequate Housing Stock – Minneapolis/St. Paul Area?

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» Only Sibley and Le Sureur have adequate housing stock.

  • Ramsey has the tightest supply
  • f housing along with the

Dakota, Washington, Anoka, Sherburne, Wright and Hennepin Counties.

  • Housing supplies starts opening

up in the northern counties like Stearns, Benton Mille Lacs, Isanti and Chisago.

Note: Based on data from Redfin.com for March 2018 to investigate housing stock.

Washington Chisago Anoka Dakota Scott Sibley Le Sueur Wright Hennepin Carver Stearns Mille Lacs Ramsey Isanti Benton Sherburne

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How Can Down Payment Assistance Help the “Mortgage Ready”?

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Note: Credit bureau data

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What Are the Short Term Opportunities?

Short Term

Mortgage Ready Population 2,737,920

Target cities based on African American populations, mortgage ready, and adequate housing stock