Eleele residents are first in state to own homes through HUD program

ELEELE — Friday was a moving day, and moving day, for Tony Coronel.

He become the first person in the state to achieve homeownership through a new federal initiative for low-income families, which was emotionally moving for him.

Then, he had to go back to work as a driver for Kauai Commercial Company, after the lunchtime ceremony attended by Mayor Bryan J. Baptiste and officials from the U.S. Department of Housing and Urban Development (HUD) and County Housing Agency.

Before he left, though, he felt compelled to offer a few words after dignitaries had their say.

“This is my graduation from the school of hard knocks,” said Coronel, who didn’t graduate from high school. “Mahalo to all of you. I just better stop before I start crying.”

His family moved into the three-bedroom, two-bath home in March, enabled by a federal program administered on Kauai by employees of the County Housing Agency (CHA).

“Homeownership really is a possibility” for lower-income Kauaians, said Kenneth Rainforth, CHA executive on housing.

Baptiste said he is proud of the Coronel family for persevering in their dream of homeownership, and proud of CHA employees for assisting the family in achieving that dream.

“This makes it real for us,” said Michael Liu, HUD assistant secretary for public and Indian housing. Liu is a Hawaii native and former state legislator.

Liu quoted an Ohio State University study about the family benefits of homeownership that showed children in homes owned by their parents enjoy a substantially higher quality of life than children whose parents rent. Further, the children in owned homes have higher standardized test scores in math and English, and fewer behavioral problems.

The Eleele event is “significant,” as Kauai is often seen as so far away from everyplace else, yet can be and is at the forefront of this new, “national tool” for homeownership, said Liu.

Liu thanked the CHA, Bank of Hawaii, Title Guaranty Escrow & Title Services, Federal Home Loan Bank of Seattle, and others for helping the Coronels.

The purchase of the home was made possible through the HUD Section 8 Housing Choice Voucher Program, which allowed the family to voluntarily sign up for a program that allowed them to tuck away some rental-assistance savings to HUD into an escrow account to be used towards buying the home.

After years of using the HUD Section 8 assistance to pay rent, the Coronels are now using the assistance to help make mortgage payments.

CHA officials last year adopted HUD rules that allow the Section 8 rental assistance to be used for mortgage payments.

Tony Coronel voluntarily enrolled in the Section 8 Family Self Sufficiency (FSS) program, after years as a recipient of rental assistance under the HUD Section 8 program.

Through the FSS program, adults sign a five-year contract to be off of welfare and employed by the end of the contract period.

CHA employees work with the family to arrange for program services such as child care, transportation, education, job training and employment counseling, substance and alcohol abuse treatment or counseling, household skill training, and homeownership counseling.

Agency officials also establish an interest-bearing escrow account for the family, to encourage savings. As the family’s earned income increases, the amount the family pays for rent also increases, and the amount of HUD assistance decreases.

Under the FSS program, a portion of the savings to HUD is credited to the family’s escrow account. If the family completes the FSS program successfully, the escrow amount is released to the family, and may be used for any purpose.

The Coronels were enrolled in the CHA’s home-buyer education program, and that included an opportunity for them to join the Federal Home Loan Bank of Seattle’s Home$tart Plus program.

Under Home$tart Plus, FSS participants are eligible to receive a two-to-one match for funds saved in the escrow account, up to $10,000. The Coronels were able to earn the full matching grant.

County officials acquired the Eleele Nani home through a buy-back clause in their affordable-housing program, and the Coronels were offered the opportunity to rent the home in March under the county’s rent-to-own program.

The home was offered for sale for $206,000.

In April, the Coronels had accumulated over $22,000 in escrow through the FSS program, and earned $10,000 from the Home$tart Plus program.

With a mortgage loan from Bank of Hawaii, the participating lender with the Federal Home Loan Bank and Hawaii administrator of the Home$tart Plus program, and the application of the Section 8 assistance towards homeownership, the pieces in the puzzle had come together.

Another 50 families are currently enrolled in the county’s FSS program.

Business Editor Paul C. Curtis can be reached at mailto:pcurtis@pulitzer.net or 245-3681 (ext. 224).

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