Millions of Americans formerly shut out of homeownership
because they have been unable to save enough for a downpayment

The issue of millions of Americans locked out of homeownership continues to frustrate well-intentioned policymakers. Their concerns are hardly trivial.  Recent studies make it clear that those who own homes are far more likely to attain greater financial security and social stability than those who do not.

Even as America’s overall homeownership rate languishes, one segment of that total is further disadvantaged.  Minorities are nearly 30% less likely to be homeowners than Caucasians, since the rate of Caucasian homeownership is 74%, while the minority rate is 48.5%. This means they face a much more uncertain fate when it comes to achieving the American dream of homeownership.

Spending on housing represents 20% of the national economy.  No wonder, then, that the foundation of most families’ wealth in the United States is homeownership.  A home is normally the fastest-growing part of their portfolio.

In many cases, 95% or more of the initial home cost is provided by the lender, who secures the obligation through a mortgage. This means, for those who qualify for a downpayment gift provided by a nonprofit downpayment provider or through the American Dream Downpayment Fund have instant equity in that property. This is because the gift or grant is just that:  It is not repaid. A $5,000 downpayment gift or grant on a $100,000 home yields the buyer $5,000 in immediate equity in the property. Assuming a 3 percent per year price appreciation, the home’s value will increase to nearly $116,000 in five years. This means an equity increase of nearly $21,000 assuming the buyer has paid down $4,900 of the mortgage principal over that time. This represents an annual investment return of more than 33%.
Recent studies focused on the social impact of living in one’s own house clearly demonstrate a broad range of advantages accruing to homeowner families. These benefits span a broad range of quality of life payoffs – from higher school grades and lower teen pregnancies to stronger neighborhood collaboration and greater voter participation in local, state and federal elections.

Among the findings:

  • Children of homeowners showed a 9% higher probability of being in school than those of renters.
  • Teenage pregnancy rates in families owning their homes are from 2-4% lower than for families who rent.
  • Children of homeowners have a 25% higher probability of completing high school than renters’ children.
  • Children of homeowners have a 116% better chance of graduating college than renters’ children.
  • Children of homeowners had a 59% better chance of being homeowners themselves within 10 years of leaving the parental home.
  • Math achievement scores are 9% higher among homeowners’ children than renters’ children.
  • Reading achievement scores are 7% higher among homeowners’ children than renters’ children.
  • Homeowners are 25% more likely to vote in local, state and federal elections than renters.

It has become unmistakable that homeownership is America’s most effective vehicle for citizens to achieve family generational wealth.  This wealth begets an economic “ripple effect” in neighborhoods where new homeowners settle, creates jobs, and increases the tax base and spurs business start-ups.  As recent studies make clear, homeownership is also the cornerstone for vast improvements in quality of life.

Children of homeowners are more likely to go to school, do well at school and go on to college.  Homeowners themselves are more active in community and exercise their fundamental right to vote in local, state and federal elections in far larger numbers than those who do not own their homes.

Homeownership is not an entitlement. But it opens the door for those who enjoy it to achieve the economic and social stability and life quality that is the envy of the world.

The American Family Funds Down Payment Assistance program helps more families accomplish the dream of homeownership.













Joel S. Pate, Chairman of American Family Funds founded the American Family Funds, Down Payment Gift Program in 2001. In addition, Mr. Pate helped to form the industries trade association, the Homeownership Alliance of Non-Profit Down payment Providers (HAND). Consequently he served a term as HAND's first elected Chairman. HAND members include: American Family Funds, Inc., The AmeriDream Charity, CDS Grants, The Dreamhouse Charity, Family Home Providers, The Genesis Program, Home Buyers Assistance Foundation, Homes for All Program, Nehemiah Corporation, and Neighborhood Gold.

Customer service is the bedrock of the Pate companies. Toby Harris, VP of National City Mortgage is quoted as saying "American Family Funds is the Nordstrom's of Down Payment Assistance."

Joel S. Pate speaks at Loan Toolbox Business Plan 2006 held in Las Vegas, NV, sponsored by Loan Toolbox and Source Media.

Source Media provides market information, including news, analysis, and insight to the financial services and related industries such as accounting, and technology, through its publications, industry standard data applications, seminars and conferences. Its flagship publications include American Banker, National Mortgage News, the Bond Buyer, and Accounting Today.

In addition, Source Media is the leading publisher of information on the mortgage market. Utilizing websites, database products, publications, and proprietary research, the Mortgage Group provides an extensive product mix which includes: Broker Magazine, Weird Loans, Origination News, Mortgage Servicing News, and Mortgage Technology. For more information about Source Media, visit: www.sourcemedia.com.

LoanToolbox, created by top loan originator Tim Braheem, teaches more than just how to present different loan programs, how to overcome objections, and how to qualify a borrower. They have tried and tested mortgage broker lead generation campaigns to help you get loans in your pipeline. LoanToolbox, with material from mortgage industry giants like Dave Savage of the Mortgage Coach and Greg Frost of ACTion Marketing. For more information about Loan Toolbox, visit: www.loantoolbox.com

LoanToolbox includes: Strategies for developing lasting referral relationships with Realtors, CPAs, financial planners, insurance agents, and other business professionals, complete marketing campaigns for new and existing clients, over 60 scripts to polish your presentation and create the right image, a turnkey database management system using Tim Braheem's custom ACT! template and Greg Frost's ACTion Marketing system, a step-by-step walkthrough of the perfect loan process, easy-to-implement time management training and business planning, tips for building and training a profitable team, the fundamentals of taking a proper loan application, qualifying borrowers, and reading tax returns, simple explanations of FHA and Subprime loans, credit repair, industry rules and regulations, and a whole lot more. www.loantoolbox.com

Greg Frost and his team funded 1,362 loans in 2004, making him the 8th most prolific loan originator in America. Last year, he was also the # 1 FHA originator in the nation, according to MORTGAGE ORIGINATOR MAGAZINE. For more information about Greg Frost, visit: www.gregfrost.com

Joel S. Pate has been quoted in National Mortgage News, Broker Magazine, The Mortgage Press, and the Mobile Register.

Joel S. Pate is also the Founder of Vadium Group, a division of National Mortgage Advisors, LLC, that provides Business Development functions to medium size lenders that desire to expand their market reach and penetration without investment of the firm's capital and human resources.

Vadium Group provides the skill sets needed by lenders on a contractual basis in return for long-term residual income that is derived from the results achieved.