The Neighborhood Assistance Corporation of America (NACA) is a nonprofit agency that has developed a reputation in recent years for making it possible for people who are considered financially unstable to buy homes. NACA's philosophy is that more home owners translate into better neighborhoods and schools. The basic idea that guides NACA is that people who are properly educated about what home buying entails, and are also given good rates, will have more of a reason to stay and invest in their communities.
NACA covers its operational costs through various income streams. Members' dues, real estate brokerage commissions and mortgage brokerage fees account for the bulk of NACA's operational budget [source: NACA]. Furthermore, the nonprofit is paid $2,000 for every home loan it secures. This amount is paid for by the lender [source: Huscock]. NACA is able to provide funding for home loans through the agreements it has with several leading financial institutions. Two of NACA's biggest partners are Citigroup and Bank of America. According to the NACA Web site, the agency has approximately $10 billion in bank commitments.
While NACA is responsible for screening and then counseling, the banks supply the funding. Once someone qualifies for a NACA home loan, there is an extensive counseling process that's meant to prepare prospective home owners for the financial responsibilities that lie ahead. A mortgage consultant will sit down with a qualified NACA member and assess how much he or she can afford. By providing such counseling services, NACA seeks to prevent its members from buying homes that are beyond their financial means. NACA members may purchase co-ops, condos or family residences. A maximum purchase price for a home is established, which is based on region. As far as the home search goes, members may use either NACA's agents or hire their own real estate agent, as long as he or she has been approved by NACA.