By Edward Gaston (Florida Star/NNPA Member)
From predatory lending and foreclosures to wealth stripping and income inequality, the national wealth gap is relevant and ongoing. The wealth gap continues to expand based on one of the greatest heists of all time: the shifting of generational wealth from one cultural group to another.
The wealth gap has been validated and maintained over generations. Minorities have been denied access to capital to build businesses and grow farms. They have been forced to pay higher interest rates for mortgages and disproportionately — and intentionally — impacted during the nation’s foreclosure crisis. Women continue to be paid less to do the same work as men in Corporate America, and underserved communities pay high interest rates for emergency loans.
Sadly, no solutions have proven to be sustainable across these communities in order to lessen the gap. With the foreclosure crisis, Americans watched minority and low to moderate income homeowners lose equity and generational wealth with no plan for recovery. It is highly unlikely for the wealth that has been denied or stripped from underserved communities to suddenly reappear. However, there are some solutions to bridge the gap, one of which is home ownership.
Although the financial crisis negatively impacted homeownership for many communities, it remains a proven weapon for increasing wealth, particularly through home equity and tax benefits. Homeownership is very different from purchasing clothes or buying a car, which loses value. Having your own four walls is still part of the American Dream.
Homeownership done right, can put Black families on the path to growing equity, which is a necessary step toward securing generational wealth. Put simply, buying the right home, the right way is a big step toward filling the wealth gap to combat generational poverty. Second to saving money, purchasing a home is considered as a common sense investment strategy for building wealth. To assist with homeownership, it is imperative to connect with a HUD certified counseling agency, which is available in most communities to walk you through the process to prepare for and purchase a home.
These organizations have industry experts on staff, who are empowered to create individual resolutions and solutions and train buyers on building wealth through homeownership. To find an agency, visit HUD’s website at https://www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm.
The housing market is rebounding and although underserved and low to moderate income homebuyers still face hurdles that others do not, it is necessary to work toward homeownership and bridge the wealth gap.