Independent Banker - February 2024 - 71

Unlocking the doors to
homeownership
The annual income required of potential homebuyers recently experienced its largest increase
on record. To help more Americans get on the property ladder, SouthState Bank developed a
new program to support low- to moderate-income individuals. By Bridget McCrea
he American Dream of
homeownership has become
increasingly difficult to attain due to
high interest rates, tighter lending
standards and a lack of starter home
inventory. Housing costs have risen
across most states, and according to
the National Association of Realtors,
the typical U.S. homebuyer now
needs an income of $107,000 a year,
up from $88,000 in 2022. This 22%
jump-the largest on record-puts
homeownership even further out of
reach for many families.
T
Understanding the struggles that
many prospective homeowners are
facing, $45 billion-asset SouthState
Bank in Winter Haven, Fla., rolled
out the Opportunity Advantage Loan
Fund, a program designed to help
low- to moderate-income (LMI)
individuals and families unlock the
doors to homeownership.
The initiative is fully funded by the
community bank, which allocated
$10 million to be used over a
three-year period.
However, SouthState may replenish
the fund if it's depleted in less
than three years. Available to LMI
homebuyers in Alabama, Florida,
Georgia, the Carolinas and Virginia,
the program awards a loan fund of
up to $12,500 to qualifying buyers.
Recipients can use the money for
their down payments, closing costs
or other purchase-related fees on a
primary residence.
Addressing housing affordability
According to Stephen Cannon,
SouthState Bank's mortgage
co-president, the loan is 100%
forgivable with no repayment and
0% interest if the buyer owns the
home for at least five years (there
are repayment stipulations for
homeowners who sell before reaching
the five-year mark).
Name:
SouthState Bank
Assets:
$45 billion
Location:
Winter Haven, Fla.
The offer must be combined with
one of these mortgages: the bank's
Buyer's Advantage or Community
Advantage, Fannie Mae's Home
Ready, Freddie Mac's Home Possible
or a United States Department of
Agriculture (USDA) mortgage.
Cannon says the community bank
developed the fund to help " address
housing affordability, down payment
and closing cost assistance issues. "
SouthState spoke to community
leaders to learn more about the most
pressing housing and home buying
issues. " Overwhelmingly, the theme
" [We] wanted to
make sure that this
forgivable second
mortgage would go
behind whatever
first mortgage was
beneficial to our
customers. "
-BRENT HARRELL,
SOUTHSTATE BANK
was that affordability was a financial
barrier for many people looking to
buy, " notes Cannon, " especially in the
form of a down payment and funds
needed to close. "
After gathering information from
the community and allocating funds
to its new program, SouthState
launched the Opportunity Advantage
Loan Fund in May 2023. To be
eligible, applicants must have an
income of 80% or less of their county's
area median income (adjusted for
family size). Borrowers can only use
the program funds for the purchase of
a primary residence.
When developing the program,
Brent Harrell, mortgage co-president,
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