{"id":9174,"date":"2022-12-05T12:00:53","date_gmt":"2022-12-05T17:00:53","guid":{"rendered":"https:\/\/www.realtyhop.com\/blog\/?p=9174"},"modified":"2022-12-02T14:05:53","modified_gmt":"2022-12-02T19:05:53","slug":"what-is-the-naca-program","status":"publish","type":"post","link":"https:\/\/www.realtyhop.com\/blog\/what-is-the-naca-program\/","title":{"rendered":"What is the NACA Program?"},"content":{"rendered":"

The Neighborhood Assistance Corporation of America, or NACA<\/a>, helps low-and-moderate income homebuyers secure financing to purchase and renovate homes. Established in 1988, NACA set a goal to build strong neighborhoods through affordable homeownership.<\/p>\n

What Does NACA Do?<\/h2>\n

NACA prepares future homeowners with financial education and support. The organization also provides financial counseling to make sure a buyer can handle the commitment needed to buy a home and pay for ongoing future expenses associated with homeownership. NACA members also have access to lenders offering a low-rate, no-fee mortgage loan.<\/p>\n

Homebuyers who would not qualify for a conventional mortgage may turn to NACA for assistance. NACA does not use a credit-score-based approach to pre-qualifying homebuyers. Instead, the nonprofit organization developed its own technology and underwriting guidelines focusing on character-based lending. If applicants become NACA-qualified, they can apply for a mortgage through the organization\u2019s homebuying program. <\/p>\n

How NACA Helps Homebuyers<\/h2>\n

NACA has over 40 offices around the country, with many located in large cities such as New York City<\/a>, Boston, Chicago, and Washington, DC. NACA does not originate mortgage loans but works with outside lenders, such as Bank of America, to provide what the nonprofit describes as the \u201cBest Mortgage in America.\u201d Between 1996 and 2021, Bank of America and NACA\u2019s partnership resulted in over 42,000<\/a> mortgage loans.<\/p>\n

NACA believes in the power of homeownership and strives to help low-and-moderate income buyers who may not typically qualify for a mortgage. Each year, NACA holds community events across the country in Queens<\/a>, NY, Baltimore, MD, and Miami, FL. These events draw thousands of attendees wanting to learn about this unique home-buying opportunity.<\/p>\n

The organization\u2019s approach starts by educating potential homebuyers through four-hour workshops. The program\u2019s loan approval philosophy considers an applicant\u2019s employment stability and ability to pay bills considered under their control.<\/p>\n

Additionally, NACA assists with other aspects of homeownership, including home renovations, through their Home and Neighborhood Department (HAND<\/a>). After settlement, the Membership Assistance Program (MAP<\/a>) supports new homeowners and helps those in financial distress avoid foreclosure.<\/p>\n

What Does NACA Require From Homebuyers?<\/h2>\n

If you\u2019re interested in a NACA mortgage, you can learn more about the organization by attending a local event and speaking with their employees and volunteers. To participate in the NACA process, you should plan to do the following:<\/p>\n

Attend a Homebuyer Workshop<\/h3>\n

The process starts with a free Homebuyer Workshop<\/a>. You do not have to join NACA to attend this initial event. At the workshop, you\u2019ll learn about NACA\u2019s qualification process and hear testimony from others who have used NACA to help buy their home.<\/p>\n

Live in the home you purchase<\/h3>\n

NACA provides access to financing for buyers interested in purchasing a home that will serve as their primary residence. NACA will place a $25,000 lien on the property to ensure that the home remains owner-occupied when purchased using a NACA mortgage. You cannot use the NACA program to buy an investment property, except for multi-family properties where owners live in one of the units. When you purchase a home through NACA, you cannot own any other home. The NACA program allows timeshares.<\/p>\n

Personally participate in the organization<\/h3>\n

NACA requires its participants personally contribute to the organization through advocacy or volunteering at a minimum of five events each year. NACA also charges a nominal membership fee of $25.<\/p>\n

NACA Loan Terms<\/h2>\n

Buyers who become NACA-qualified can apply for a mortgage through the nonprofit\u2019s lending partners and receive a low-rate, no-fee loan. Although the NACA program prioritizes low- and moderate-income individuals, higher-income buyers wishing to purchase homes in neighborhoods identified as \u201cpriority areas\u201d may also participate. However, non-priority buyers may receive less favorable interest rates.<\/p>\n

Typically, NACA mortgage loans offer the following terms to homebuyers:<\/p>\n