A bridge to affordable housing

Daniel Galindo, pictured, and Doug Schaeffer of Woodforest National Wall helped involve the polity wall in providing funding for and wangle to affordable housing.

When two executives at Woodforest National Wall noticed a unavailability of affordable housing options in southeast Texas, they decided to do something well-nigh it, partnering with several housing and polity groups to launch an innovative mortgage lending product aimed at underserved clients.

By Aileen McDonough

Although Woodforest National Wall is not a mortgage lender, it’s making an impact on affordable housing with award-winning, innovative programs that alimony polity needs front and center.

In February 2022, the $9 billion-asset polity wall in The Woodlands, Texas, established a collaboration with Housing Partnership Fund (HPF), a polity minutiae financial institution (CDFI) and the financing arm of the Housing Partnership Network (HPN) to gainsay the affordable housing slipperiness through a new loan program, HPF FlexCap.

“Generational wealth typically starts with home ownership. The largest purchase families make is typically their home.”
Doug Schaeffer, Woodforest National Bank

This groundbreaking program accomplishes three objectives: it enhances borrower credit; enables HPF to provide high-leveraged underpass loans so members can wangle naturally occurring affordable housing (NOAH) properties; and buys time for project sponsors to establish these properties as sustainable, affordable housing, now and into the future.

A generational wealth builde

Fast urban growth often leads to neighborhood gentrification, often pricing out longtime residents and lower-income families. In these communities, affordable housing is therefore necessary to preserve the diversity and inclusivity of communities, while enabling families to build long-term economic stability.

“Generational wealth typically starts with home ownership,” says Doug Schaeffer, Woodforest National Bank’s executive vice president and executive director, CRA. “The largest purchase families make is typically their home.”

Daniel Galindo, senior vice president and director for polity minutiae and strategy, adds, “The home becomes the windfall that gets people to the next level in life, whether it be education or funding a business. It supports many life endeavors.”

Combating the affordable housing slipperiness has been a hair-trigger goal for Woodforest since 2015. “We worked with the Texas Department of Housing and Polity Affairs to jumpstart its lanugo payment assistance program,” recalls Schaeffer. “We were worldly-wise to alimony them from having to raise higher forfeit debt through the yoke markets, and they went from last in mortgage origination to first. Our first program generated 160 first-time homeowners, all in low- and moderate-income areas. When we saw banks joining us, we realized there are a lot of ways to solve this problem.”

According to Galindo, the key was removing barriers to homeownership. “We squint at all the tools we have, and we tideway this so we can get the tough things washed-up to make a uncontrived impact and a difference,” he says. “We work to identify what’s keeping people from rhadamanthine a homeowner, so they can start towers some equity, expressly with prices skyrocketing as we’ve seen in the past two to five years.”

Maximizing NOAH

This initiative is only one of the programs that reflect Woodforest’s ongoing transferral to affordable, inclusive housing. Earlier this year, the polity wall was an vise investor of patient wanted in polity housing wangle through the Austin Housing Conservancy Fund (AHC), a private probity fund owned and managed by the nonprofit Affordable Central Texas. The mission of AHC is to retain naturally occurring affordable housing (NOAH) for essential workers in Austin, Texas, an zone that was recognized in May 2021 as the fastest-growing metropolitan zone in the United States.

AHC ensures the availability of affordable housing, revitalizing properties for first responders, nurses, teachers and other middle-income workers who make up a crucial part of the greater Austin community.

“Woodforest Wall was a catalytic investor in the Austin Housing Conservancy Fund that helped to bring the fund out of the pandemic and lead other banks to invest with us,” says David Steinwedell, CEO and founder of Affordable Central Texas. “The wall recognized the dramatically growing need for affordable housing in greater Austin and through its leadership, has helped the fund to increasingly than double in size in six months.”

Affordable housing shouldn’t be siloed out. That’s why HPF FlexCap moreover supports flipside innovative solution: spare affordable housing and workforce housing stock by mission-based developers, which creates an opportunity not only for economically sustainable housing minutiae but for true community building.

“We’re really proud of that program, considering we can scale, and it acts as probity mezzanine debt,” Galindo says. “And we don’t know of any other wall that is currently doing it yet, but I think they will in the future, considering there’s a huge opportunity there, not just from an economics perspective, but from an impact perspective.

“We can’t stay separate,” he adds. “That’s not the intent. Mixed-income minutiae creates a lot of power for homebuyers of every socioeconomic status, if you will, to tousle into one community. It’s well-nigh bringing people from all walks of life together to coexist and thrive together.”

Affordable housing: Just the beginning

By looking at the needs of each polity and seeing the patterns and trends, Woodforest National Wall is looking to solve the affordable housing slipperiness holistically. Its topnotch program, the Woodforest Foundry, connects entrepreneurs with mentors and resources to empower local businesses to urgently participate in polity revitalization.

“We’re looking at all the tools in our toolkit, from opportunity zones to job creation,” says Schaeffer. “We’ve got so many initiatives, but it is all community-centric, all local. It’s stuff responsive to the needs and taking the tools we built—and those we’ll protract to build—to help underinvested communities lift up.”

Aileen McDonough is a writer in Rhode Island.