Helping First-time Homebuyers Realize the American Dream

Even the coronavirus pandemic couldn’t keep Lorino Smith from fulfilling her dreams!

Homeownership, higher education and a self-owned business are all versions of the American Dream; but for many these days, those things seem far out of reach. United Way of Central Alabama (UWCA) is working to change that through the Individual Development Account (IDA), a statewide component of the federal government’s Assets for Independence.

The Individual Development Account helps individuals and families build assets and develop skills for financial self-sufficiency through financial coaching and training relative to their goals. Participants may then invest in their futures by buying a home, paying for higher education or starting or expanding a small business.

Lorino Smith, a longtime Birmingham resident, used the program to become a first-time homeowner, despite the ongoing COVID-19 pandemic. Smith worked hard her entire life but needed to increase her credit score and reduce her debt-to-income ratio in order to be approved for a mortgage. After learning of the IDA program, she applied. And her first appointment was lifechanging. She discovered that through the matched-savings program, she had to save only $2,000 in a year to be granted an additional $4,000 for her down payment.  In her case, the match funding came from a combination of the Assets for Independence program and the City of Birmingham’s Community Development Blog Grant (CDBG) program.

“I couldn’t believe my ears,” Smith said. “I got so excited that I told [the program adviser] I’d do it in six months!”

Smith completed the IDA program successfully — saving the $2,000 and meeting all financial-skill-development requirements and then choosing a house. Meanwhile, she had UWCA Financial Stability Specialist Judy Woods to support her through some unforeseen inspection issues with her new home, as well as the intricacies of the mortgage process. She was finally able to close on the house on April 30, 2020, officially becoming a homeowner in the throes of a pandemic.

“Becoming a homeowner is the best thing that could’ve happened to me,” Smith said. “All I needed was a little help, which I got from United Way.”

The IDA program is just one of many ways UWCA is helping people throughout Central Alabama become financially stable and independent. Click here for details about the IDA program.

And to learn more about making hope happen for countless individuals every day – and how you can help – please click here. LIVE UNITED.