Two Berks County nonprofits have joined forces to help get working families into their own homes.
Officials from Neighborhood Housing Services of Greater Berks and Habitat for Humanity of Berks County say collaboration and financial education are keys to making home ownership possible for more working people.
NHS administrators and Habitat’s Executive Director Timothy J. Daley reported on their organization’s individual and joint efforts at City Council’s committee of the whole meeting last week.
The two nonprofits joined forces about six or seven years ago, said Stephen Gieringer, CEO of NHS.
“It made a lot of sense from a nonprofit perspective, but also from an administrative perspective that we maximize the talents of these two organizations,” he said.
Both have programs to rehabilitate blighted and vacant single-family homes, helping to address the insufficient supply of affordable housing options for the local workforce.
Workforce housing targets individuals earning between 60% and 120% of the area median income. This includes essential workers like teachers, police officers, firefighters, municipal workers and retail service workers, Gieringer said.
But NHS and Habitat are not just helping first-time homebuyers secure a mortgage, he said. The nonprofits are teaching them how to sustain homeownership.
Financial education and counseling play a critical role in that, they said. That’s why both nonprofits require homebuyers to complete courses on financial literacy and receive ongoing education on budgeting.
Habitat Berks and NHS collaborated to require a 50-hour financial awareness course for their clients, making Habitat Berks the only Habitat affiliate in the U.S. to require a such a course for its homebuyers, Daley said.
Both organizations also have their own additional educational requirements, Daley said.
For example, Gieringer said, every specialized lending program offered by NHS to first-time homebuyers requires clients to go through an eight-hour buyer education class, he said.
On top of that, he said, they’re required to have one-on-one credit and budget counseling.
“This is a real-world budget,” Gieringer said.
The counseling takes a comprehensive look at a family’s finances, he noted, accounting for everything from cellphone bills and insurance premiums to entertainment and child care.
The latter is a financial challenge for many families, he said.
“You no longer have that sole provider type of family dynamic,” Gieringer said. “So you have to have two family members working, and when that happens, you could have child care expenses of $600 to $700 a month. And when that’s not calculated from the lender’s perspective, they (homebuyers) think everything’s great.”
Anyone who uses NHS assistance also must participate in annual counseling sessions for seven years, he said.
NHS also steps in to help clients experiencing hardship by offering loan modifications, forbearance or term changes. That flexibility is something traditional mortgage lenders rarely provide, he noted.
Daniel Sansary, executive director of NHS, also emphasized the organization’s role in strengthening communities through financial education.
Sansary said NHS also brings financial literacy lessons to local high schools through partnerships with credit unions. Students participate in financial reality fairs, role-playing as adults with careers, budgets and bills. At the end, they meet with a counselor to assess how well they managed their finances or how badly they missed the mark.
“They come in and go, ‘Oh yeah, I want the $750-a-month truck payment,’” Sansary said. “Well, you better get a camper for the back of it, because that’s where you’re going to live.”
Most students are shocked to realize how quickly expenses add up, he said, especially when faced with unexpected events like a car repair or medical bill.
“We’re doing everything we can, not just in the housing space, but also making sure financial literacy and education is the number one thing that gets imposed and taught to our students,” Gieringer said. “Because without that, it’s like sending sheep into a wolves’ den. Everybody’s going to take advantage of them when they don’t understand how finance, banking and budgeting works.”
Gieringer said anyone interested can get started by filling out an intake form on the NHS website or contacting staff directly. Even those not yet ready to buy a home are welcome to take the class or seek counseling.
“We don’t deny anybody,” he said. “If you’re not where you need to be, we’ll help you get mortgage-ready.”
But he also offered a word of caution, noting NHS services can’t compensate for what he called stupid mistakes.
“You can’t go buy a car in the middle of the homebuying process,” he said. You can’t change jobs in the middle of the process. You just sank your own ship. We didn’t contribute to that, but we do have a plan to help you get back on your feet.”