NEWARK, New Jersey (WABC) -- Some Newark Housing Authority residents will soon get the opportunity to participate in a renter-to-homeowner voucher program.
Araselys Maldonado, a public housing tenant, will become the first Housing Choice Voucher holder to become a homeowner through Newark's new partnership with the Neighborhood Assistance Corporation of America.
"We are committed to creating pathways for more of our Newark residents to become homeowners no matter their income level," Newark Mayor Ras Baraka said. "This closing day is just one of many to come and we look forward to having numerous residents enjoy the independence and empowerment of achieving the American Dream of home ownership."
Maldonado's current Housing Choice Voucher of $1040 will now be applied to her mortgage payment instead of a landlord, and she will pay the remaining $213 out of pocket.
The NACA's Homeownership Through Public Housing Assistance program is designed to help those within the public housing system become homeowners by providing a mortgage that requires fewer upfront costs.
NACA's mortgages come with no down payment, no closing costs, and no mortgage insurance at a below-market fixed rate without consideration of the applicant's credit score.
Maldonado secured a 3.5%, 20-year-fixed mortgage for her new home at Cutler Street at a purchase price of $185,000.
The program is designed so Housing Choice Voucher recipients would never pay more than 30% of their income toward the monthly mortgage payment.
The $35 billion funding for the program comes from a $20 billion commitment from the NACA and $15 billion from Bank of America.
Overall the program's goal is to provide opportunities for renters to become first-generation homeowners.
NACA was founded in 1988 and is the largest HUD-approved nonprofit homeownership organization.
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