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A Generic Example of an Employer-Assisted Housing Program

More employers are beginning to recognize that the availability of nearby housing their workers can afford is important to the success of their business.  Recent Metropolitan Planning Council (MPC) publications, including Housing for a Competitive Workforce:  Homeownership Models that Work and For Rent:  Housing Options in the Chicago Region, demonstrate the need for housing options close to employment and provide examples from around the country of employers working to help their employees achieve homeownership.  None of these companies is in the housing business, but each recognizes that by decreasing worker commute times and helping workers become homeowners, employer-assisted housing programs can help companies save money.

This sample program offers a way to envision an employer-assisted housing program, including potential program partners and their roles.  Employer-assisted housing is a flexible program that can be tailored to meet the needs of a particular employer.

Program Components

  1.  A special first mortgage loan product and a conventional second mortgage product,
  2. Downpayment/closing cost assistance provided by the employer,
  3. A community-based nonprofit Regional Employer-Assisted Collaboration for Housing (REACH) partner who provides homebuyer education and program administration, and
  4. Government support in the form of deferred second mortgages to buyers earning less than 80 percent of median income.

 Potential Partners and their Roles

 1. Participating companies

  • Promote homebuyer education,
  • Provide grants to employees for downpayment/closing costs,
  • Demonstrate leadership in considering housing, and
  • Contract with the REACH partner for counseling services and program administration. 

 2. Community-based REACH partner

  • Provides homebuyer education to employees of participating companies,
  • Conducts follow-up with interested employees,
  • Administers the EAH program, and
  • Serves as a liaison to financial services industry, realtors, etc.

3. The Metropolitan Planning Council

  • Provide assistance in program design and development,
  • Assist in outreach/presentation,
  • Conduct regular program evaluation, and
  • Assist in positive public relations and press coverage. 

4. Banks

  • Originate the loan, participating in IHDA program, 
  • Provide a second mortgage pool, and
  • Offer special loan products, including reduced fees or interest rates. 

5. Illinois Housing Development Authority (IHDA)

  • Provide a special loan product for employees of participating employers and
  • Reimburse the REACH partner for counseling services

6. Local government

  • Provide a soft subordinate mortgage,
  • Offer downpayment assistance to its employees, and
  • Make available operating support for the REACH partner working with local employers. 

These components, in various combinations, are used in various programs locally and across the country.  Consider how a model could be modified to serve your community and work with your partners.

For more information, contact Samantha DeKoven, MPC housing associate, at 312/922-5616, ext. 145, or sdekoven@metroplanning.org

 

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