Tuesday, October 30, 2012

5000 Starbucks Volunteers Help Fifth Ward CRC Make a Better Houston

By Gary Wolfe
District Director, Rocky Mountain Region

How do neighborhoods go from declining to improving? Fifth Ward Community Redevelopment Corporation (Fifth Ward CRC) has used partnerships to help turn around Houston’s Fifth Ward.  Most recently, Fifth Ward CRC partnered with Starbucks, during their Global Leadership Conference in Houston, to make a positive difference in the lives of the Fifth Ward residents.
Starbucks "Team Blue" built a playground
Starbucks "Team Blue" built a playground

In early October, more than 5,000 Starbucks employees volunteered with community members to make a tangible impact.  Starbucks CEO Howard Schultz said to KHOU 11 News “When I walked through the Fifth Ward and saw the conditions of the houses and really the people in need, I just thought this is where we need to be.”

In the Fifth Ward, the day began when the thousands of Starbucks volunteers took a bus from their downtown hotels to staging grounds at local churches. There, they ate lunch, learned about the Fifth Ward neighborhood and grabbed the tools they needed to paint homes, install pocket parks and community gardens, clean up vacant lots, put up community artwork and the like. Fifth Ward CRC projects focused on the Lyon’s Avenue Corridor, a 22 block area which encompasses the community’s “main street” and comprised of residential, commercial and public spaces with a unique blend of historical markers reflective of the community’s native sons and daughters. 

In total, more than 9,000 Starbucks employees who attended the Global Leadership Conference participated in volunteer projects across Houston. On average, the Starbucks employees volunteered between four and six hours at each project for an impressive total of more than 42,000 hours of community service over the three days of the conference.
Lyons Avenue Renaissance sign with numerous partners listed
Lyons Avenue Renaissance sign with
numerous partners listed

For the Lyon’s Avenue Corridor area, the volunteering was just one piece of the ongoing revitalization work. Fifth Ward CRC is committed to a complete community renaissance, which will include not only great homes and clean streets, but also new jobs and opportunities. Michael Emerson, Chairman of the Fifth Ward CDC told KHOU 11, “This is an image for us of what Fifth Ward is going to be,” said “We’re creating an economically diverse, ethnically diverse, economically strong, new neighborhood here in Houston.” Fifth Ward CRC has formed partnerships not only with Starbucks, but also with the City of Houston, Rice University, University of Houston and the American Regional Institute of Architects to change the landscape and future of Fifth Ward. With the help of collaborations like these, Fifth Ward CRC can return to being a “neighborhood of choice.” 

To learn more about the Starbucks-Fifth Ward partnership, view this news video or click here to see more photos.

Friday, October 26, 2012

What Makes You Part of a Community?

This blog entry is reposted from the Stable Communities blog

Avenue CDC photo courtesy of
Epic Shots Photography
A three-year study by Gallup and the John S. and James L. Knight Foundation in 26 communities has been exploring the factors that attach residents to their communities and how community attachment plays a role in an area's economic growth and well-being. In general, the study results have shown that cities with the highest levels of attachment had the highest rate of GDP growth.

The Knight Soul of the Community (SOTC) study has studied residents' attachment to their communities — and how it's related to economic development — over 3 years, using interviews in English and Spanish with 14,000 residents.

The study analyzed 10 "domains" that were found to drive community attachment at varying levels:
  • Basic services — community infrastructure
  • Local economy
  • Safety
  • Leadership and elected officials
  • Aesthetics — physical beauty and green spaces
  • Education systems
  • Social offerings — opportunities for social interaction and citizen caring
  • Openness/welcomeness — how welcoming the community is to different people
  • Civic involvement — residents’ commitment to their community through voting or volunteerism
  • Social capital — social networks between residents

The SOTC site has results by community, a video gallery. Of special interest to community organizers and others working in their community include reports, videos and data that can be downloaded and shared. A Twitter feed provides a place to share experiences (with hashtag #SOTC).

Thursday, October 18, 2012

What Are Reverse Mortgages Anyway?

This article was jointly produced by the NeighborWorks America National Foreclosure Mitigation Counseling team and the Home Equity Conversion Mortgage (HECM) program team.

We hear a lot about reverse mortgages in the media, but there is a good deal of confusion about what they are and how they work. To begin with, many people refer to “reverse mortgages” in general, when they really mean to speak about those loans offered specifically by the Federal Housing Authority (FHA). This post focuses on these FHA reverse mortgages, also called home equity conversion mortgages, or “HECM” loans.

The idea behind a HECM loan is that many older borrowers are house-rich, but cash poor. Imagine, for example, an elderly retired couple that has long since paid off their home, but lacks the money needed for daily expenses like medicine, gas and food. A HECM loan would allow the couple to use their home’s equity as a form of income. They would borrow against the market value of their home and get cash in return.  To pay off the loan, they or their heirs might sell their home some years in the future or repay with other means.

Advantages of a reverse mortgage include the fact that the homeowner can stay in their home and does not repay the loan until he moves or sells the property, or passes away. At that time, the borrower owes the lesser of the loan balance or the value of the property.  A HECM loan thus differs from a home equity loan in that the borrower doesn’t need to make any payments during the life of the loan. Furthermore, there are no traditional income or credit requirements. To qualify for a HECM loan, a homeowner must be at least 62 years old and own their home free and clear or be able to pay off all existing mortgage debt with HECM loan funds. The homeowner must also talk with a HUD-approved HECM counselor.

An illustration of a successful HECM loan situation might be a family where an aging father wishes to remain in his family home, but lacks savings to be able to pay for all his regular bills. Instead of having to sell his house, the father can stay where he is and continue to be around the people and places that have meant so much to him throughout his life. His children may not be able to keep the family home if the loan is not repaid, but during the father’s life, he may be able to maintain a greater degree of financial independence.

However, HECM mortgages are certainly not for everyone. One big challenge is that they encumber the borrower’s property with debt, which is not in alignment with all cultural values and may complicate or preclude the borrower’s ability to pass the home on to his or her heirs. If the borrower’s heirs are unaware of how the HECM loan works, they may be unpleasantly surprised to find a large debt owed on the property. It’s also possible that an elderly borrower might be alive, but have health issues that prevent him or her from continuing to live in the home. Should the borrower move out, say to a nursing home or to live with family, someone would need to assume responsibility for closing out the HECM loan.  Repayment options include selling the home, repaying the loan or refinancing the loan.

In recent years, some foreclosure counselors have recommended HECM loans as a way for older clients to pay off their debt and remain in place. In these cases, a borrower would take out a lump sum HECM loan, and use it to pay off the balance of their conventional mortgage debt. This would buy the borrower time, but it might not leave the borrower with any extra cash, meaning that they would still need to find a way to pay for their day-to-day living.  Another source of income would be needed — which could be a problem if, for example, the foreclosure was the result of multiple family members losing their jobs.

In all cases, homeowners considering a reverse mortgage should carefully explore whether it is the most appropriate means of achieving their financial ends.  Housing counselors help homeowners clarify their objective and whether a reverse mortgage best fits that goal.  Counselors also ensure homeowners take all fees and charges into account, walk homeowners through the rules to confirm the borrowers understand completely the unique mechanics and risks of this loan type, and help homeowners avoid scams. However, counselors are no substitute for evaluating personal values or talking to family members. Borrowers should think carefully about what choice is best for them, their family and their legacy.

For a list of HUD-approved HECM counselors, visit https://entp.hud.gov/idapp/html/hecm_agency_look.cfm

HECM counselors can also visit www.hecmcounselors.org for more information on HECM Counselor training and technical assistance available from NeighborWorks America.

Thursday, October 4, 2012

Equity Express: Uniting Financial Management and Environmental Responsibility

By Karuna Mehta,
NeighborWorks America,
Green Strategies program fellow
Just in time for Energy Awareness month, we are sharing a blog about our new Equity Express class. The initiative responds to two major crises of our time – economic and ecological – by increasing the wealth of asset-poor households through consumer choices that are both financially smart and promote sustainable living.

As a young professional with a limited budget, saving money is always at the back of my mind.  While I’ve tried to abide by the same “save, save, and save some more” mentality as my parents, in today’s world it’s easier said than done. Many of NeighborWorks homeownership and financial fitness counselors encounter similar experiences counseling low- and middle-income clients who are hoping to buy homes or simply get out of debt. For most of us, it doesn’t seem possible to save money by committing to living a more sustainable, healthy lifestyle. 

However, hope is not lost on being both "green" and financially savvy. This summer, homeownership and financial fitness counselors from all over Ohio came together to learn how living a healthy, sustainable lifestyle can also help you save some green. The two-day train-the-trainer workshop, hosted in partnership with the Center of Neighborhood Technology, is called “Equity Express” and describes opportunities to save money in nearly every facet of our lives while improving our health and lessening our environmental impact. The workshop introduces counselors to an alternative way of teaching financial education and provides them with resources and materials so they can incorporate sustainable ideas and green living into their own curricula.

Creative Commons image
Equity Express emphasizes the importance of monitoring six areas: budgeting, energy, transportation, food, communications and “green lifestyle,” which focuses on how much “stuff” we consume and buy and how we dispose of it. The materials taught in each workshop are tailored to analyze the trends and events that are occurring in that region—for example, counselors from Cleveland received “Cleveland-specific” information while those from Cincinnati learned about the health and environmental impact in their own metro area.

While some topics, like those revolving around consumption and budgeting, were already common in a number of the counselor’s own curricula, participants also learned about managing energy costs through reducing wasted energy. They began assessing where transportation alternatives such as walking and biking fit into their lives, and reassessed how their affinities for certain kinds of food would impact their health and bank accounts in the long run.

Using resources provided by Equity Express, many of the counselors discovered large potential savings for themselves. Class participants were shocked when they took a look at their own utility bills and calculated the nutritious values (or lack thereof) of their favorite foods. Some even called their children and spouses during break to share the information they'd just learned.

Class participants with their certificates of completion
The workshop also gave as an opportunity to take a look around the office of Neighborhood Development Services (NDS) in Ravenna, Ohio, where the workshop was held. The executive director and his staff have committed to greening their organization, including taking out unnecessary lighting, enforcing recycling and limiting the amount of waste they produce.  NDS board members and staff have iPads to limit the amount of paper they use and their commitment to environmental conservation is inspirational. Not only is the staff creating sustainable housing, but they are “walking the talk” when it comes to their own daily lives, creating a more durable, healthy and inspired workplace for themselves.
At the Equity Express workshop, counselors realized the first step in teaching about a low-cost, sustainable life was living by these principles ourselves. We set goals for kicking our addictions to things like fast food and cheap clothes and electronics. Some people vowed to cook a little more often and eat a little less meat, others re-examined the differences between wanting and needing a new smart phone or television. Still others discussed carpooling with their co-workers and pledged to think twice before buying new stuff.

Budgeting and managing expenses is crucial for those who seek financial counseling or help with homeownership, and resource efficiency is also critical to "going green." Sustainable living improves long term and short term health, creates a more durable living environment and helps people save money in the long run, making it an incredible tool for promoting money management as well as equity. Financial workshops such as Equity Express incorporate the importance of sustainable and socially responsible living empower clients and inspire local and global action through simple changes in one's daily routine.