Wednesday, April 7, 2010

IDAs Save Homes From Foreclosure


Over the years, the microfinance industry has shifted its focus from increasing incomes to building the assets of its clients. After all, assets are the key to financial stability, allowing us to weather storms, such as the big, rainy mess we're in now.

Individual development accounts (IDAs)--matched savings accounts funded, for the most part, through the federal program Assets for Independence--are a powerful tool for financial security. New research from CFED and the Urban Institute shows that low-income homebuyers who used IDAs to buy their homes were two to three times less likely to lose their homes to foreclosure, probably because their IDAs enabled them to avoid subprime mortgages.

Which begs the question: at a time when foreclosures are at a record high, why is this innovative program--with proven results--getting only $19 million a year, while the big banks have gotten hundred of billions?

If you are a graduate of Women's Initiative interested in opening an IDA, please click here for more information.

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