One Presidential Candidate's $100 Billion Housing Proposal

• July 8th 2019

by Nena Perry-Brown

This year, there has been a good deal of coverage of housing disparities and displacement in the U.S., and concerns about housing availability and affordability have come to the fore in the 2020 presidential race on both sides of the aisle. Now, one presidential candidate has released a proposal which would address both issues.

This weekend, Democratic candidate Kamala Harris unveiled her proposal to help close the homeownership gap by providing homebuying aid in previously redlined areas. Under the plan, $100 billion in federal grants would be used to offer prospective homebuyers in certain neighborhoods up to $25,000 in down payment and closing cost assistance. 

In order to qualify for the assistance, the applicant must have lived in the same redlined community where they hope to purchase a home for at least a decade, and the community must still be low-income. Households which receive the grant must earn no more than $100,000 for a family ($125,000 in high-cost areas like DC) or $50,000 for an individual ($75,000 in high-cost areas). The home also cannot be priced higher than $300,000.

The proposal would also address the Fair Credit Reporting Act, specifically requiring that payments on rent, phone and utility bills be calculated in credit scores. Expanding what can be included in credit score calculations has long been acknowledged as a means to give more low-income earners a means to build credit. The proposal would also require that, when making debt-to-income calculations for Federal Housing Administration loans, mortgage underwriters compare monthly debt expenses to monthly income rather than comparing total debt to annual income.

Some of the provisions in Harris’s plan, including down payment assistance, were included in the American Housing and Economic Mobility Act reintroduced in the Senate by candidate Elizabeth Warren earlier this year. 

This article originally published at https://dc.urbanturf.com/articles/blog/one-presidential-candidates-proposal-to-close-the-racial-homeownership-gap/15625.