Mortage Program Aims to Overcome Home-Buying Obstacles for Hawaiʻi Residents

Jul 9, 2018

Hawai'i homebuyers Billy and Joey Friels sit down with counselors from the national non-profit Neighborhood Assistance Corporation of America to go over the final details of their mortgage application.
Credit Ku'uwehi Hiraishi

Affordable housing is one of the biggest issues confronting Hawai’i residents. The state’s high cost of living, relatively low wages, and lack of affordable housing make it hard to become a homeowner. So a new mortgage program that made its debut in Hawai’i late last week is attracting a lot of interest. HPR’s Ku’uwehi Hiraishi reports.

Construction worker Billy Friel and his wife Joey live with their four teenagers in Waimanalo. For seven years, they’ve been renting from friends and family to save up for their own place – something they still can’t afford.

Construction worker Billy Friels (with mic) shares his thoughts on the hardships of buying a home in Hawai'i at the NACA's "Achieve the Dream" event at the Hawai'i Convention Center.
Credit Ku'uwehi Hiraishi

“I put up high rises and listen to the developers talk about having affordable units and I just don’t know who it’s affordable for?” says Friel. 

Friel heard about a new mortgage program in Hawai’i offered by Boston-based housing non-profit Neighborhood Assistance Corporation of America or NACA

“You can get a mortgage with no down payment, no closing costs, no fees, at a below-market fixed-rate and we don’t consider your credit score,” says Marks.

NACA Founder & CEO Bruce Marks addresses homebuyers at the Hawai'i Convention Center. Marks launched NACA's Hawai'i debut late last week. The Boston-based non-profit has been fighting predatory and discriminatory lending practices in the housing industry for 32 years.
Credit Ku'uwehi Hiraishi

Bruce Marks is the organization’s founder and CEO. 

“The biggest road block for working people to buying homes is the down payment and the closing costs,” says Marks, “We’ve eliminated that. The second biggest impediment is the credit score, which is not reflective of rather or not someone is ready for homeownership.”

Hawai'i homebuyers go through the final stages of pre-approval for the Best in America Mortgage offered by NACA. The mortgage program include no down payment, no closing costs, and low interest rates.
Credit Ku'uwehi Hiraishi

Unlike traditional risk-based pricing used by lenders, NACA employs what they call  “character lending.” 

“So we look at someone’s payments that they make over 12 to 24 months. So we know whether they control that payment or they don’t,” says Marks, “So that’s a much more accurate reflection of whether someone is ready for homeownership than just looking at a credit score.”

Then they qualify people for a mortgage based on what they currently pay for rent and what they save every month.

Local 5 Union member and hotel worker Cesilee Linares (left) helps a prospective homebuyer upload documents to NACA's system.
Credit Ku'uwehi Hiraishi

“Actually in Hawai’i, you know people are paying such a high amount in rent that they can take that same amount they’re paying in rent and use it on a mortgage payment,” says Marks.

Marks says about 700 people attended the group’s workshops over the weekend. They were co-sponsored by the Local 5 union as part of their “One Job Should Be Enough” campaign. Here’s union member and hotel worker Cesilee Linares.

“Honestly when I first heard of it, I thought it was too good to be true,” says Linares.

29-year-old Linares and her husband Jaren both work for the Hilton Waikiki. Jaren also makes extra money driving for the ride-sharing company Lyft. 

Nic Groves and his wife Paola Rodales get word that NACA approved their mortgage application for as much as $500,000.
Credit Neighborhood Assistance Corporation of America

“Currently we’re renting in Honolulu and we pay $1,400 a month…for a two-bedroom,” says Linares.

The couple have a six-year-old son and a baby on the way in Janaury – and hopes for a mortgage approval.Homeownership came quicker than expected for 29-year-old Nic Groves and his wife Paola Rodales.

“We were always in discussion of ‘Ok, do you want to save for a down payment?’ That would be like years just to save for a down payment,” says Groves, “And now we’re like ‘Ok, let’s start looking for a house.’”

NACA approved the couple for as much as $500,000. As for the Friels, they’re in the final stages of pre-approval. They spent nearly all day at the workshop.

“One way or another we need to get a home. Living in Hawai’i, cost of living is high, pay scale is low. It’s a battle,” says Friel, “It’s a battle not to wanna move to the mainland. And I don’t wanna move to the mainland.”

NACA's homeownership event continues through Tuesday, July 10, 2018, from 6:00 a.m. to 6:00 p.m. at the Hawai'i Convention Center. Bring financial documents such as pay stubs, W-2s, tax returns, bank statements and credit card statements. For more information, visit NACA.com.