Drury helps employees become homeowners

by Jill Henry

SBJ Reporter

sbj@sbj.net

Drury University has partnered with Southwest Teachers Credit Union to offer full-time faculty and staff a 1.5 percent discount on prevailing mortgage loan rates for home purchases or improvements in the area surrounding Drury's campus.

Drury employees will follow the standard procedure for obtaining a loan through the credit union, but the 1.5 percent discount is issued by Drury as a stipend in their monthly paychecks, and the credit union then reimburses Drury half of that amount, said Raymond Worley, vice president for administration at Drury.

"The stipend is for the first five years, and then that goes away and they have the normal, regular, market-rate loan at that point," Worley said. The stipend ceases if the employee leaves the university. Drury receives no commission or funding from generating the loans, Worley said.

In order to qualify for the program, homes must be located within the area bordered by Chestnut Expressway, Boonville Avenue, Locust Street and Sherman Avenue. Worley said funds for issuing the monthly stipends would come from the university's operating budget.

Steve Wansing, president of Southwest Teachers Credit Union, said the credit union's role in the program is to help its customers teachers, administrators, maintenance workers, custodians and other individuals who work in the educational field.

The program also helps the credit union get back into the business of home mortgages. "We got out of that when interest rates started dropping, and we really didn't have a demand for that loan because mortgage rates were changing so fast," Wansing said. "We felt like members were better off going to some of the national firms. Now that the rates have kind of bottomed out, stabilized and gone back up a little bit, we feel more comfortable."

Wansing said the loan program could make a "tremendous difference" to participants. On a $100,000 loan, "one-and-a-half percent is going to be $1,500 in a year. That could go a long way in getting settled."

Southwest Teachers Credit Union has placed a cap on the program, allowing a total of $500,000 in loans to be written.

Drury expects the program to grow. "As we approach the top end of that cap, both Drury and Southwest Teachers Credit Union will review that and likely we would consider bumping it up to $1 million pending approval by both organizations," Worley said. "But (the cap) helps us monitor the progress of the program."

Progress so far has been steady. Mark Wood, PhD, chemistry professor at Drury for the last 12 years, and his family moved into a new home on North Washington Avenue on Feb. 21, making them the first family to take advantage of the program.

"I wanted to be near my work so I could walk to work; I wanted to be near the downtown environment; I wanted to be a part of what's going on down here, and I wanted to leave the Ozarks intact," Wood said, adding that there are plenty of quality housing options within the city, without urban sprawl sacrificing the beauty of the area.

Wood said his 2,300-square-foot home formerly the site of Kappa Alpha fraternity house was built "specifically to fit the streetscape. As a matter of fact, we've had so many people come by and ask if we were remodeling." The home loan was approximately $200,000, Wood said.

Worley doesn't anticipate all of the loans being the size of Wood's. "Some of those will be home-equity loans," he said.

Employer-assisted homeownership programs not only help workers become homeowners, they can also help the community and the organization the homeowner works for. Sandy Goodwin, senior deputy director for the Fannie Mae's Kansas City Partnership Office, said that such programs help employers deal with retaining good employees, and it helps use homeownership as a community revitalization tool.

"And it bears out that families or individuals who own their own homes tend to be more engaged as citizens," Goodwin said. "They vote at a higher rate, they get more involved in local school districts, they have children. So they become more actively engaged in the community because they own something in it. It's just a good thing and a good way to help stabilize a community that may be in trouble or strengthen a community even if it's not in trouble."

Similar programs have been implemented in the area, including one for employees of the city of Springfield effective Aug. 1, 2003. Peggy Thompson, human resources specialist, said the city's program offers regular part-time and full-time employees assistance with down payment and closing costs up to $5,000, with $1,000 forgiven each year that the borrower remains in the city's employment. The city also offers rehab loans up to $7,500 with the city buying down the interest rates.

"We've had three employees receive the down-payment closing-cost loan and one employee has received a rehab loan," Thompson said, noting that several employees are in the application process.

To qualify for the city's program, employees must be regular part-time or full-time, on the job for at least one year, and the home must be within the borders of Grand Street, Kansas Expressway, Kearney Street and National Avenue.