Study Hails DPA’s Economic Impact

Sacramento, CA — January 29, 2009
By: Nehemiah Corporation of America

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Down Payment Assistance (DPA), a unique economic empowerment program pioneered by Sacramento-based Nehemiah Corp. of America, had a major beneficial impact on the U.S. economy last year, generating $38.6 billion in revenues and creating 235,000 new jobs, according to a new study released today.

The study is the most thorough ever done on the economic ripple effects of DPA, a program discontinued late last year by the Bush Administration. Nehemiah is seeking to have the program revived as part of the economic stimulus efforts under review by the Obama Administration.

Formed in 1994, Nehemiah is a non-profit that specializes in helping working-class Americans overcome the biggest obstacle to buying a home by providing them with a down payment. Nehemiah-style down payment assistance, sometimes referred to as privately-funded DPA, works with participating sellers to assist credit-worthy borrowers in obtaining the American Dream.

Well over one-hundred thousand supporters have sent letters and made phone calls to regulators and politicians in Washington, D.C. demanding legislation for reformed DPA. This broad based advocacy movement argues that reviving DPA as soon as possible will help jump-start the sagging economy and boost demand for the foreclosed properties now glutting the housing market. The latest version of DPA also has toughened credit requirements, increased mortgage insurance premiums and other improvements resulting in a program that according to a recent analysis by the Congressional Budget Office, costs the American taxpayers nothing.

“Since 1997, DPA programs have helped more than one million Americans realize the dream of home ownership,” the company said in a fact sheet accompanying the report. “Reinstating DPA programs today will play a key role in creating jobs, reversing foreclosure trends and stimulating the economy.”

The economic-impact study, commissioned by Nehemiah, was done by two well-respected California economists, Dr. Robert Waste and Dr. Robert Fountain. Dr. Waste is a professor of public policy and administration at California State University, Sacramento and was chairman of the Sacramento City Planning Commission from 2000 to 2003. Dr. Fountain is a former professor at California State University, Sacramento with more than 25 years experience in teaching and research on issues related to housing and regional economics.

Some highlights of their research:

• More than 200,000 new and existing homes were sold last year with DPA. (The research covered the 12 months from December 2007 through November 2008.) Roughly 40% of all loans originated by the Federal Housing Administration used DPA.
• Nehemiah helped families purchase more than 78,000 homes last year. More than 25% of the sales involved foreclosed properties.
• About 40% of the borrowers were households headed by minorities and more than one-third were headed by females.
• Of 235,000 new jobs created last year, 195,000 came from new-home construction and the rest from new-home sales. DPA also accounted for $4.6 billion in total tax revenues last year.

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Contact:

Dr. Robert Waste
Phone: (916) 804-8185

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For additional information, please contact Shelley Mitchell, smitchell@nehemiahcorp.org, 916-231-1999.

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