The American dream of homeownership has never been a walk in the park. Just like other success stories, it comes with its hurdles. One of the cosmic limitations that prevent many people from achieving the American dream of homeownership is down payment. For ages, the down payment requirement has been the difference between owning a home and paying rent.
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recent survey by the Urban Institute shows that more than two-thirds of renters termed down payment as the ma jor barrier to owning a home. Saving the money required for the down payment is a hurdle to many low-tomiddle income Americans. However, there is hope! On August 4, 2020, Senators Cory Gardner (R-CO) and Doug Jones (D-AL) introduced the American Dream Down Payment Act of 2020. This bipartisan legislation will significantly help prospective home buyers save for a down payment. The Act would help home buyers save for a 20% down payment by creating special tax-advantaged savings accounts that Americans can use for down payments and other specific housing costs. The accounts would work in the same way as the popular 529 Plan accounts that help people save post-tax money for future educational expenses. “As the coronavirus pandemic continues to devastate our nation’s economy, it is getting even harder for many folks in Alabama and across the country to 12
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American Dream Downpayment Act: A Bill that could potentially revive the American Dream of Homeownership put money away in savings and to work toward the American dream of owning a home,” Senator Jones, a member of the Senate Banking & Housing Committee stated. “Down payments are the biggest barrier to homeownership for first-time homebuyers, especially among low-income and minority Americans, and make it harder to build generational wealth that is often tied to homeownership. Our legislation would provide a new path to help make the dream of buying a home a reality by making it easier to save money for down payments and other housing-related costs.” Once passed, the American Dream Down Payment Act would: The Power Is Now Magazine | OCTOBER 2020
