Webinar explores role of homeownership in wealth creation

By Linda Williams

It is rewarding to build your own wealth. And often, it is even more fulfilling to pass on that wealth to your heirs. While there are many ways to build wealth, including investing in stocks and bonds, purchasing a home is one of the most effective ways to build wealth over time and be in a position to pass wealth down to successive generations.

Consumer Action hosted a webinar on July 12 that focused on homeownership as a catalyst for wealth-building for low-income families and households of color. Carl Windom, an accredited financial counselor and financial coach serving as a Freddie Mac consultant; Kristin Wong, a financial analyst on the mortgage team at the Consumer Financial Protection Bureau (CFPB); and Jeremy Montanti, the executive director of the Housing Foundation of America, joined Consumer Action's outreach team to share their expertise on building wealth through homeownership.

Windom kicked off the presentations by explaining why homeownership is crucial to building wealth, and also why Black families have not purchased homes at the same rate as their white counterparts. Among the reasons for the racial homeownership gap are barriers to affordable home loans, exclusionary housing policies and practices, gentrification and a dwindling housing supply. Among Windom’s advice for building wealth: earn more than you spend, make a financial plan, pay yourself first, give every dollar you earn a purpose, start to save and invest early, keep your money invested (buy and hold), and diversify (don't put all your eggs in one basket).

Wong presented the CFPB's tools and resources for homebuyers, and then walked the audience through the home buying process. She told the audience that it's always a good idea to check credit reports and scores, even if you're years away from shopping for a home, but added that you should check your credit reports and scores as quickly as possible if you're planning to buy a home soon. This is especially true for communities of color. (The CFPB found that consumers in majority Black and Hispanic neighborhoods, as well as younger consumers and those with low credit scores, are far more likely to have disputes appear on their credit reports due to inaccurate credit reporting.) She also provided attendees with a link where prospective homebuyers can sign up for a two-week email "Get Homebuyer Ready" boot camp.

Montanti gave the audience an overview of the role of housing counselors in both the home buying process and in foreclosure prevention. Housing counselors are trained to advise and counsel homebuyers and homeowners, and this includes helping homebuyers review their monthly budget and credit reports and assisting them in determining affordability and becoming mortgage-ready. Montanti told the audience that the biggest obstacle for prospective homeowners is the inability to accumulate a downpayment.

More than 300 staff members of community-based organizations attended the webinar. If you would like to view this or any of our many other webinars, visit Consumer Action’s YouTube channel.