(The Center Square) – It’s been two months since the launch of a Washington state home loan program aimed at countering racial discrimination in housing policies of the past.
The Covenant Homeownership Program is a product of the state’s 2023 Covenant Homeownership Act, which directed the Washington State Housing Finance Commission to conduct a study on ways to reverse “racial disparities in home ownership.”
Margret Graham, Communications Manager for the Washington House Financing Commission told The Center Square via email, “Nineteen households have closed on their homes using this program.”
Graham said, “An additional 20 or so loans are reserved, meaning the homebuyers are moving forward toward hopefully closing.”
The Covenant Homeownership Program provides downpayment and closing cost assistance for first-time homebuyers in the form of a loan, secondary to the primary mortgage loan. The loan has a 0% interest rate. It is paid back on the sale or refinancing of the home.
Individuals are encouraged to use the program if they have “deep roots” in the state, defined as being related to someone who lived in Washington prior to the passage of the 1968 Fair Housing Act.
In April 1968, the passage of the Fair Housing Act made racial discrimination in housing illegal. Discrimination persisted despite the new law; however, the state no longer had an official or legal role in enforcing and upholding it.
Eligibility criteria is based on race and income:
Black, Hispanic, Native American, Alaska Native, Native Hawaiian or other Pacific Islander, Korean or Asian Indian descendants of family who were here before 1968 are eligible.
Income level must be at or below 100% of the Area Median Income (AMI).
“The Covenant Homeownership Act is one small effort to remedy past and ongoing discrimination and its impacts on access to credit and homeownership for BIPOC and other historically marginalized communities in Washington state,” the site reads. “It does not represent a formal reparations effort.”
The Commission reports a second phase of implementation could allow participation by applicants outside the currently approved racial groups who are able to show past and ongoing impact by state-supported discrimination.
People who apply must meet the program’s statutory requirements, including being a first-time homebuyer, and able to acquire a mortgage.
