How NACA Works

In September 2014, 1,880 people lined up outside Apple's flagship Fifth Avenue location waiting to get their hands on the newest iPhone. That sounds like a pretty big crowd waiting around at 4 a.m., doesn't it? On the morning of the final day of NACA's first foreclosure-prevention "Save the Dream" event in 2008, in comparison, more than four times that — 8,000 people — waited to get into the group's free workshops and individual counseling sessions [sources: Little, Rothacker]. Attending an introductory workshop is mandatory before you're able to become a member of NACA and have access to the agency's services, which are free with membership.

There are three categories of membership. Members on the road to purchasing a home or exploring a refinance with NACA are called participating members. There are two types of home purchases available to them:

These members may be part of either NACA's Home Purchase Program, which helps potential homeowners with affordable loans to buy a home, or NACA's Home Save Program, which provides homeowners with restructured mortgage solutions to save them from defaulting on existing loans.

Members who purchased or refinanced a home through the agency are entitled to counseling and assistance throughout the life of their NACA loan; these are homeowner members. They participate in the Membership Assistance Program (MAP), NACA's post-purchase support program designed to provide counseling and short-term assistance (up to three months) if a NACA member has a financial emergency.

Lastly, there are community members. These NACA members support the organization's mission and participate in advocacy efforts, and they may or may not own a home or finance their home through NACA.

Counseling, processing, post-purchase assistance, and all of NACA's services are offered free to members, but membership dues are collected from those in the Purchase Program and from community members. The dues are folded into the borrower's mortgage payment and go on to fund MAP in addition to operation and administration costs.

To qualify for a NACA mortgage, you need to meet a few basic qualifications. First, you can't own any other property, so this isn't the way to finance your vacation home or a second property for rentals. The property must be located in a state where NACA provides its services (which aren't available in all 50 states), and you have to occupy the home for as long as you have the mortgage. The latter requirement reflects the organization's belief that people who own and occupy homes will have a greater stake in the success of their neighborhood. There's also a maximum purchase price for a home; this requirement helps to ensure the organization can focus on helping those who need it most. Most people participating in NACA are first-time homeowners, often those who wouldn't be able to buy a home without the agency's help.

Additionally, NACA-sponsored wealth-building home loans became available in 2014. These 15-year loans allow homebuyers to own their home faster, although this does mean monthly payments are typically larger than those for a NACA traditional 30-year loan.

And, finally, members must participate in community advocacy. All of NACA's members — 2 million and climbing — are expected to take part in a minimum of five advocacy activities annually, which could include joining demonstrations and rallies, advancing the agency's mission through neighborhood outreach or volunteering in a local NACA office.