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The American Dream in Microcosm

Editor’s note: this piece originally appeared in the October edition of MReport.

As a child, one of my favorite places to visit was my great grandmother’s house in Hillsborough, North Carolina. Decades later, if I close my eyes, I can still remember the smell of the bushes outside of her home and how spikey the grass felt under my feet. My great grandmother, Mom Mary as we called her, would sit on the front porch as my cousins and I played, carefully watching us with her kind eyes. I remember her face looking proud as she surveyed the land she owned and her family congregating for barbeques and reunions. I can still taste the hand-pulled chicken sandwiches she would make for our car ride back home to New Jersey.

As a child, I did not realize that this home where I spent my summers playing was the catalyst for wealth creation for generations of family members to come. This simple, small home changed the trajectory for my family. Mom Mary purchased her property in the Jim Crow South in 1936 for $500. She was widowed, with four very young boys, and worked as a house servant for white families in North Carolina. It took a considerable amount of courage for her to purchase this property. This one decision has created equity for our family, and three generations later, we are still enjoying the benefits.

What I have come to realize is my experience with intergenerational wealth is not commonly shared within the Black community. Black families have far less wealth than our white counterparts. A study done in 2016 found that white families have 10 times the median net worth of Black families. It also found the average total wealth of whites was $171,000 compared to just $17,600 for Blacks. The largest factor in this wealth disparity is home-ownership. As of 2019, the white, non-Hispanic homeownership rate is 74%, compared to 44% for Blacks. The racial homeownership gap is as wide today as it was in 1968 when the Fair Housing Act was passed. This lack of diversity in homeownership not only creates continued segregation in our communities, but it also fuels the increase in the racial wealth gap between Blacks and whites.

In my family, homeowner-ship can be traced back to the late 1800s after the passage of the Emancipation Proclamation. My great, great, great grandfather, Henderson Faribault, was enslaved, and by the age of nine, he was on the plantation field picking cotton. After he was freed, he worked hard as a chef for several notable establishments. He slowly began purchasing parcels of land and building homes. At the time of his death in 1902, he had amassed over 50 acres of land and left a home for each one of his eight children. Mom Mary’s deceased husband was a grand-child of Henderson. She was so inspired by his story, she insisted on continuing the family legacy of homeownership.

Having role models within our Black communities that show generations to come the importance and benefits of homeownership is crucial. The significance of equity building and utilizing this equity as inherited wealth cannot be understated. This wealth creation lasts well beyond one generation. It creates new opportunities for multitudes to come. Whether used to send a child to college, help to start a new business, or provide a down payment for a family member, home equity is truly transformational.

Increased homeownership in the Black community is paramount to shrinking the racial wealth gap. For Black families, however, the down payment remains the largest hurdle to homeownership. Black Americans as a whole lack the intergenerational wealth to provide their children with a down payment. Asking mom or dad for a $10,000 down payment gift for your first home is not something that is even feasible for most Blacks.

Fortunately, there are government agencies that can help bridge the gap when mom and dad do not have the resources to do so. For years, down payment assistance programs have been turning the dream of homeownership into a reality. My company, CBC Mortgage Agency, has been using the Chenoa Fund to assist over 21,000 borrowers with their down payment. In aggregate, these families have realized over $469 million in increased wealth since purchasing their homes using down payment assistance.

Down payment assistance programs also help level the playing field by providing equitable access to credit for folks that do not come from wealthy families. These programs are critical to shrinking the racial wealth gap and bringing financial balance to Blacks in our country. According to our own research, over 55% of borrowers who used down payment assistance are minorities, and of these borrowers, over one third are first-generation homeowners. These first-generation homeowners will be role models for their children and grandchildren alike, slowly changing the wealth dynamic for their families—just like my great, great, great grandfather all those years ago.

According to a 2015 Census Bureau report, by the year 2044, more than half of all Americans are projected to belong to a minority group. As such, it is incumbent upon the mortgage industry to increase the homeownership rates within our communities of color. We must provide innovative solutions for equitable credit access and continue to support national down payment assistance providers. These solutions will provide resources for all Americans who do not come from familial wealth.

Increasing the Black homeownership rate will be a major step towards decreasing the racial wealth gap in our country. I look forward to an America where the minority homeownership rate is equal to the white homeownership rate—an America where intergenerational wealth stories like mine are common, not the exception. An America where the majority of Black families can look proudly over the land they own, while their children play in spiky grass, eating hand-pulled chicken sandwiches.

As long as we continue to support down payment assistance programs, which bring balance, sustainability, and equality to American homeownership, I believe this America is within our grasp.

About Author: Tai Christensen

Tai Christensen is the Co-Founder and Chief Diversity Officer for Arrive Home, a national down payment assistance social enterprise serving underbanked communities. Tai is also the host of the California Mortgage Bankers Association's podcast on Equity, Diversity and Inclusion. She serves as Chair of the American Mortgage Diversity Council (AMDC), and also serves as a board member for Axis Lending Academy, a non-profit that focuses on providing the mortgage lending industry with a more diverse talent pool of job candidates. Tai is a winner of the 2023 National Mortgage Professional Women of Inspiration Award, the 2022 Thought Leader Award for Progress in Lending and the 2021 Mortgage Professional America Elite Women Award. She has been featured on Fox Business News, as well as articles in the Washington Post, Mortgage Professional America, MReport, Real Estate Weekly, Forbes, and numerous podcasts. Tai is passionate about assisting credit worthy borrowers in disadvantaged communities become homeowners and build intergenerational wealth through homeownership. Tai lives in Eagle Mountain, Utah, with her husband, three daughters and their black lab, Charley. She attended Brigham Young University in Provo, Utah, and has over 20 years of experience in the mortgage industry, specializing in working with underserved communities.

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