Program’s unique structure to serve as model for expanding homeownership opportunities
MINNEAPOLIS–(BUSINESS WIRE)–Sep. 23, 2014– U.S. Bank closed on a $2.6 million investment in the Sustainable Home Ownership Program (SHOP) Bridge to Success Fund, expanding homeownership opportunity in the Twin Cities. The fund also received investment from clients of the bank’s high net-worth wealth management unit Ascent Private Capital Management.
SHOP, which is a partnership between Greater Metropolitan Housing Corporation and Dayton’s Bluff Neighborhood Housing Services, provides alternative financing for potential homeowners who are otherwise ineligible for traditional financing with the primary purpose of allowing such borrowers to eventually resolve credit issues and equity challenges, and move into traditional financing.
“The SHOP Bridge to Success Fund is unique in that it utilizes a contract-for-deed structure to expand homeownership to those who do not qualify for traditional financing,” said Carolyn Olson, president of Greater Metro Housing Corporation. “Thanks to investors like U.S. Bank and its clients, we’re able to expand local homeownership opportunities and, in turn, better our neighborhoods in need.”
With the SHOP Bridge to Success Fund, homes are sold to buyers on a contract-for-deed basis, with the buyer agreeing to refinance into a traditional mortgage once they meet the necessary credit requirements. The fund’s investors, which also include the Minnesota Housing Finance Agency and the nonprofit Family Housing Fund, receive payment once the traditional mortgage is in place. SHOP is one of the first programs in the country to utilize this structure, which has been praised by the Federal Reserve Bank of Minneapolis as a way to expand homeownership.
“SHOP is a prime example of business and community development partners coming together to develop a solution that meets the needs of our community,” said Phillip Trier, market president for U.S. Bank in the Twin Cities. “In addition to soliciting private business investment, SHOP provides an attractive, socially-responsible investment opportunity for individual high-net-worth investors. Hopefully, it can serve as a template and help generate capital to support homeownership nationwide.”
U.S. Bank is proud to support neighborhoods in the Twin Cities, its headquarters market. Last year the bank committed more than $264 million to the Twin Cities in the form of community development loans, tax credit investments, U.S. Bank Foundation grants, corporate giving and nonprofit sponsorships. That funding helped spark urban development, create new affordable housing and foster entrepreneurship. Furthermore, the bank’s employees in the Twin Cities spent more than 64,000 hours volunteering in the community.
About Sustainable Home Ownership Program
SHOP™ (Sustainable Home Ownership Program) is a socially responsible not-for-profit homeownership lending program of Greater Metropolitan Housing Corporation in partnership with Dayton’s Bluff Neighborhood Housing Services. Together, we share a vision of affordable housing and increasing the quality of life within our communities. While our partnership serves the entire Minneapolis St. Paul area market, our primary mission is to provide products for underserved individuals and families. We offer a wide range of mortgage lending programs including FHA, VA, conventional mortgages, MHFA programs, various down payment assistance programs, and our exclusive Bridge to Success Contract-for-Deed program. SHOP also focuses on outreach efforts into the community. We have built extensive networks with community not-for -profit agencies, faith-based organizations and financial institutions to reach families who desire to become homeowners or who want to remain in their existing homes. SHOP emphasizes home owner sustainability. We believe in getting you in the home and providing the resources that allow you to succeed in homeownership. The SHOP Team is a group of seasoned professionals that combine years of mortgage lending experience with a deep understanding of community needs.
About U.S. Bank
U.S. Bancorp (NYSE: USB), with $389 billion in assets as of June 30, 2014, is the parent company of U.S. Bank National Association, the 5th largest commercial bank in the United States. The Company operates 3,174 banking offices in 25 states and 5,005 ATMs and provides a comprehensive line of banking, brokerage, insurance, investment, mortgage, trust and payment services products to consumers, businesses and institutions. Visit U.S. Bancorp on the web at usbank.com.
Source: U.S. Bancorp