DENVER — Five participants of Denver Housing Authority's 5-year financial literacy program graduated on Monday.
According to DHA, the Family Self-Sufficiency (FSS) program "is to encourage economic self-sufficiency through employment."
Participants sign a contract that denotes their current income and rent. When their rent increases above that amount because of an increased income, the difference is deposited into an escrow account. After meeting certain goals, the participants can "cash out" their account.
Five participants were given certificates of completion on Monday and checks to go toward their financial goals.
“It is a HUD-funded program, and at the heart of it, it's an employment program," said Annie Hancock, DHA director of resident and community connections, and the executive director of Friends of DHA. "So, we work with residents in helping them secure employment, and specifically try to secure employment with opportunities for economic growth and job mobility."
Hancock said participants must be living in public housing and must sign a contract that ties their rent prices to their earnings.
“Their rent is sort of set so… they may not have income, and they may be paying between $50 and $100 a month in rent as they find a job and they start working, and the income goes up. Their rent goes up, right? It's about 30% of their income,” Hancock said. “And so that difference between their new rent and that contract rent is actually moved into an escrow account.”
DHA matches the amount in the escrow account at the time of graduation. According to Hancock, the "cash out" checks can range from $5,000 to $56,000.
Hancock said participants learn valuable skills, including how to lower their debt, increase their credit scores, and work toward long-term financial goals. Other requirements include:
- Maintaining employment at least 32 hours per week or more for at least six consecutive months prior to requesting a cash-out.
- Earning a household income of at least 150% of the Federal Poverty Level.
- Repairing credit to a recommended credit score of 620 or provide verification of three forms of non-traditional credit.
- Reduce credit so that contractually obligated debts are no more than 15% of Gross Monthly income.
- Derogatory debts are reduced by 25% of the initial debt reported on the credit report.
- No one in the household may receive TANF cash assistance 12 months prior to requesting cash out.
There are 275 to 325 participants actively enrolled in the program.
Hancock sees FSS as at least one solution to some of the housing and economic issues Denver residents face.
“I think that ultimately, (this) is another pathway to opening up more affordable housing because we're helping people navigate out, which opens up opportunities on the back end for people to enter into housing,” Hancock said.
Kindra Brenner just graduated from the program and said it has changed her life.
“Before the program, I was… I was struggling. It was literally paycheck to paycheck, trying to find ways to make ends meet just to survive. After the program, I have become more financially aware. I've established savings. I've set goals for myself. I mean, I've taken so many steps to set myself up and my children up for success in the future,” Brenner told Denver7. “I believe that it has a lot of responsibility in setting me up to be the person that I am today, and teaching my daughter those same fundamental things in life.”
With new knowledge and the financial resources needed, Brenner is ready to buy a home.
“I have a decent down payment saved up, so I've taken the money, and they plan on setting it into a high-interest CD until I'm ready to use it so that it can continue gaining interest,” Brenner said. “I would say the biggest thing that I learned is to find a place for every penny. It doesn't matter if you're contributing $2 or $3 to a savings, find a place for every penny, set aside what you can and really just don't think of any savings as too small because eventually it'll grow and it'll get bigger.”
DHA is hosting an economic empowerment summit on Saturday, Sept. 13 from 10 a.m. to 2 p.m. at the North Lincoln Opportunity Center. The summit will provide classes on workforce development, financial freedom, and home ownership.
Everyone is welcome to attend, but registration is required. To register, click here.
