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Save Up Program Orients Residents Towards Home Ownership
By Kristin Zach
Friday, February 24, 2006
| Economically, buying a home is no small feat. It is a task that can seem daunting to first-time buyers especially if they know little or nothing about credit reports, financing, or even budgeting.
It would be nice to have someone walk you through the process and teach you the proper protocol of buying a home as well as how to save and spend your money wisely. It would also be nice to have any money you save towards home ownership matched two to one.
That’s exactly what the Steans Family Foundation is doing for residents of North Lawndale, one of Chicago’s poorest neighborhoods, located on the West Side. Housing is a major issue in North Lawndale where only 26 percent of housing units are owner occupied and the remaining 74 percent of units are renter occupied. Most residents of North Lawndale devote 33 percent of their income to rent, the second highest percentage out of 77 community areas according to the Steans Family Foundation statistics.
“Community housing costs are rising, property taxes are getting too high for seniors to afford,” said Felicia Dawson, Program Officer for Family and Community Asset Building at the Steans Family Foundation. “The new housing being built does not necessarily support the income levels that exist currently.”
To help North Lawndale residents acquire homes, the Steans Family Foundation established an Individual Development Account (IDA) program called Save Up!. IDAs are matched savings accounts designed to assist hard-working individuals and families by helping them to build assets. “This program allows individuals in North Lawndale or that want to live in North Lawndale to save their money and receive a match towards educational goals or home purchase opportunities,” said Dawson.
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Home of resident who completed the Save Up! Program |
| The Save Up! Program began in 2000 and is a community-wide program that not only encourages saving, education, home ownership and community investment, but it also encourages people to access programs for financial counseling. The goal is to help home buyers and to build the economic strength of North Lawndale by teaching residents how to become more self-sufficient. “North Lawndale is becoming more economically stable as people are presented with resources to help them buy homes and go to college,” said Heather Steans, a trustee at the foundation.
The Steans Family Foundation, which was started in 1986 by Harrison and Lois Steans and their three daughters, Heather, Jennifer, and Robin, focuses almost all of its time and money into North Lawndale structuring the program so that if people buy homes in North Lawndale their savings towards a down payment on that home will be matched two to one. The matching dollars come from a federal grant that the foundation was able to secure.
“The essence of the program is teaching people how to manage their money and to make smart decisions about the money they make and save,” said Dawson. Before a person can open a Save Up! account, he or she must undergo credit counseling and attend nine hours of classes in financial literacy as well as learning about budgeting and credit reports, she said.
To qualify for the program a person must be employed and their income must be within a general qualifying range. If he or she has bad credit, credit counselors will help the person to work it out. “We have a partner agency that does credit counseling and fixes credit problems. It is an organization that provides budgeting classes and helps people to understand their own credit reports,” said Steans. The program also has a time frame. The money has to be saved within 36 months and $55 must be deposited into the account every month. A closed account means that someone has bought a home.
“Some people lose their jobs so there is a leave of absence policy,” said Dawson. “If you need to make an emergency withdrawal there’s a policy for that. If you can’t make the $55 a month, they’ll figure out a way in your savings plan to pick up that extra money over the next few months.”
The Save Up! Program has presented a few unexpected problems for the Steans Family Foundation. “It takes a lot longer for people to do the savings than we expected especially when they need to clean up their credit problems. Having enough affordable housing ready for people to buy homes and move in is hard to do,” Steans said. |
The Steans Family Foundation is located at 3333 W. Arthington |
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The program stresses the idea that once a people get their house, they have to stay there, encouraging them to keep and maintain their homes. Twenty-five people have purchased homes in North Lawndale with the Save Up! Program and many more have active Save Up! accounts. “We are charged with opening 350 savings accounts,” said Dawson In a feature conducted by WTTW’s Chicago Matters, Steans explained, “Pay day loans and high interest rates tend to be used in communities like North Lawndale but Save Up! helps people to open accounts within a bank and develop relationships within the banking environment that are productive at lower costs.” Accounts can be opened with Bank of Lawndale, Chase, or Harris Bank. A program similar to Save Up! is offered by the Neighborhood Housing Services of Chicago (NHS). NHS offers free homebuyer education classes in many neighborhoods. It also offers Home Ownership Centers which provide counseling, services, and training that customers need to purchase, rehabilitate, insure and maintain a home. Save Up! and NHS want to provide residents with the knowledge they need to be successful home buyers and home owners.
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The Community Bank of Lawndale |
To access an application for the Save Up! Program, click here.
WTTW's Chicago Matters ran an extensive feature on the Stean's Family Foundation's Save Up! Program. To view this feature, click here.
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Ryan's Site |
