Build Wealth MN giving Black families the keys to homeownership

Rochelle Washington went from rental housing and Section 8 to owning her own home after going through the Build Wealth MN program.

Photos and story by David Pierini, Editor

Everyday, Rochelle Washington sweeps her floors. She wipes down door knobs and inspects the window sills for dirt. She smiles whenever she notices the smell of the wood in her brand new three-bedroom house.

Washington spent 22 years as a renter and was dependent on the federal government’s rental assistance program known as Section 8. But in March, she became the first person in her family to purchase a home.

“When I was on Section 8, they helped me stay housed, but that was it,” said Washington. “I became a homeowner all on my own without the help of Section 8 or my landlord. These systems are supposed to be put in place to help, but all they do is hold you back.”

Washington learned how to budget her money, bolster her credit score and purchase and maintain a home through Build Wealth MN, a North Minneapolis-based nonprofit that sets families living in underserved areas on a path to homeownership. Since 2004, Build Wealth MN and its founder, David McGee have guided more than 3,000 families to own their own homes.

Washington’s success story is part of a new Build Wealth initiative called 9,000 Equities, which aims to finance 9,000 new homeowners over the next five to seven years and thus reduce the state’s wealth equity and homeownership gap.

Rochelle Washington helps her children, Kymora, center, and Carmelo Gianino with homework on a recent afternoon.

Just over 25 percent of Blacks own the homes they live in, according to figures compiled by the data research initiative Minnesota Compass. In contrast, 77 percent of whites own homes.

It would take 59,775 new Black homeowners to completely close the gap, McGee said.

“We’re trying to get 9,000 Black families into 9,000 homes to start 9,000 legacies,” he said. “That’s what we believe. With proper education and preparation, owning a home should start a legacy.

“We’re trying to get families to break cycles of generational poverty and build wealth in a way that goes on for generations.”

Black families have been disproportionately locked out of creating generational wealth by purchasing homes that later get passed on to their kids. The U.S. Census Bureau reports Black Americans have the lowest homeownership rate than any other racial group.

According to data compiled by the Home Mortgage Disclosure Act in 2020, Black applicants were denied mortgages at a rate of 80 percent higher than White applicants.

Beating barriers with knowledge

McGee’s program first strikes a blow at the biggest barrier – the belief that homeownership is untouchable for Black families.

“We’ve been conditioned to believe that even if we get a house, we’re already concerned that we’re going to lose it,” McGee said. “Even before you close, you’re already concerned that you’re going into foreclosure. It’s conditioning based on what we’ve seen over the generations.”

Build Wealth walks students through building a family stabilization plan. Each family has a coach as they go about learning how to budget and develop a savings plan. They learn how to look at credit reports and rebuild scores to reach 640 or better.

McGee says the essence of the training is about how systems work, good or bad, and determine how they benefit families. The classes reset focus on family and challenge students to reprioritize relationships to make family the single more important part of life.

“Now we start to see it as a wake up call,” McGee said.

Another system McGee wants students to master is employment and whether they are earning up to the value they bring to their employers.

“We’re trying to help folks unlearn some things and recondition them,” he said. “We can get caught up in discrimination and all that or we can make it a thing that I’m going to find out what my skillsets are, be able to articulate them the right way and carry myself in a way so that the system operates for me.”

The family stabilization program is at the heart of Build Wealth, but the organization also has developed a loan pool to provide down payments and other lending services. This is made possible through partnerships with government housing entities and various lending institutions.

“Part of the 9,000 equities, the goal is to educate and ally with other partners to have a different kind of loan pool to help folks get in. “It’s like all hands on deck.”

Lavonte Henderson with his youngest son, Kerrari, 5, in front of their Brooklyn Park home. “It’s really fulfilling,” Henderson said. “I really can’t explain it. I’m now able to say this is ours.”

On the road to 9,000

Lavonte Henderson was like a lot of his friends, a renter. He started to consider pursuing homeownership as he saw many in his circle forced to move around as landlords began to raise rents.

Henderson had already begun the work to raise his credit score to eventually win approval for a mortgage. A friend recommended Build Wealth to put him in a better position.

After graduating Build Wealth, Henderson bought a 1,800-square-foot, two bedroom home on a spacious corner lot in Brooklyn Park and moved in with his two sons on April 19.

“The biggest takeaway from the class was getting the home is one thing,” Henderson said. “Sustaining, maintaining it and staying a homeowner is a big thing. I would say the trick to staying in the home is you have to love the home. I feel like if you love it, you’ll take care of it. And you’ll do what you have to to keep it, especially making sure the bills are paid.”

Kerrari Henderson scoots down his driveway in Brooklyn Park.

Like Washington, Henderson is constantly on top of spots and clutter. He also is vigilant about staying on top of necessary fixes and maintenance, and building a “rainy day fund” for bigger repairs.

“It’s really fulfilling,” Henderson said. “I really can’t explain it. I’m now able to say this is ours.”

Washington, too, is still trying to find the words to describe the feeling of owning a home. But she has no trouble describing her life as a renter and feeling hemmed in by the income limits to remain in Section 8 housing.

If she made too big a jump in income, she would lose her voucher for rent. It did not matter that she needed to pay for groceries, school supplies, clothes for her children, daycare and transportation. She said she even once quit a job because it would have left her vulnerable.

She eventually lost the voucher as she began to make $50,000, but the landlord raised the rent. The moratorium on rent because of the pandemic kept her housed but she is convinced had she not found a home, she and her four children would have been homeless.

She worked with Build Wealth for two years.

“What if (Section 8) let me make over $30,000 or $40,00 year?” she said. “I could’ve saved up to purchase a home and I wouldn’t have had to wait 22 years. Section 8 built more of a relationship with my landlord than with me. It’s like they don’t want us to build generational wealth.

“(Build Wealth) took care of me and told me never to give up. And check on me every single week to see where I was on the list. Let’s check the credit (she started the program with a score of 546), let’s do a soft pull and see what's going on. They taught me how to negotiate with creditors. Then it was, ‘OK, call your student loan people. Let’s go looking for houses.”

It took a year and a lot of houses before she found one. The one she found on James Avenue North was like striking gold. It had just been built and Washington is its first owner. It has a garage and she is getting bids to have the basement finished.

Her mortgage is $1,000, half of her last rent check. Already she is saving to purchase another property as an investment.

“This house is so brand new,” Washington said. “I got to pick out the flooring, some of the paint and the refrigerator,” she said. “I was in my last house for 14 years and probably paid my landlord’s mortgage off, so I guess this is my reward.”