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Understanding Special Purpose Credit Programs: Empowering Homebuyers to Reach Financial Success

Read Time: 5 Minutes June 29, 2023

Thinking about buying a home in today's market? Staying up to date on available mortgage options (yes, there are more than many homebuyers may think) can help more borrowers understand that homeownership could be accessible!

Homeownership is a dream for many Americans, and it can be out of reach for some homebuyers who have limited financial resources or who have been traditionally denied mortgage approvals. Given the recent interagency and cross sectors efforts to close the wealth gap, lenders, government agencies and nonprofits have come to market with programs known as Special Purpose Credit Programs (SPCPs). SPCPs are designed to meet the specific needs of underserved communities and can help borrowers achieve their dream of homeownership by providing more favorable terms and conditions, such as income restriction exceptions and most cases offer down payment assistance.

SPCPs can also be used to finance the purchase of homes in specific areas, such as those that have been historically redlined. These initiatives are designed to empower individuals and communities in their journey towards homeownership. In this article, we delve into what SPCPs are and shed light on the steps we are taking to bridge the homeownership gap. Within the Newrez Family of Companies, including Caliber Home Loans, Inc. and Newrez LLC, we offer a variety of SPCPs, including Dream Start and Freddie Mac BorrowSmart AccessSM (to name a couple). Both of these loan programs are revolutionizing the path to homeownership by empowering not only individuals, but also the communities in which we all live and work.

But What Exactly is a Special Purpose Credit Program (SPCP)?

In simple terms, it is a targeted financial solution tailored to the unique challenges faced by low to moderate-income (LMI) borrowers. By offering tailored credit options, SPCPs help establish stability and access to mainstream financial services. These programs provide personalized solutions, with customized terms and conditions, making credit more suitable and affordable for consumers. SPCPs may offer flexible down payment requirements, lower interest rates, and alternative credit evaluation methods. These programs play a vital role in overcoming obstacles that homebuyers may face when accessing traditional mortgage options. By addressing the specific needs of LMI communities, our goal is to level the playing field and empower individuals and families to actualize their homeownership goals.

Types of SPCPs:

  • Government-sponsored programs: These are home loans supported by the federal government or state governments. There is a variety of mortgage programs available from government-sponsored enterprises (GSEs), Fannie Mae®, and Freddie Mac®, including Borrow Smart Access℠.
  • Community Development Financial Institutions (CDFIs): These are non-profit organizations that provide financial services to low-income individuals and communities. CDFIs often offer SPCPs that are designed to help borrowers who may not otherwise qualify for traditional credit products.
  • Microfinance Institutions (MFIs): These are non-banks that provide small loans to entrepreneurs and small businesses. MFIs often offer SPCPs that are designed to help borrowers who may not otherwise have access to credit.

Leveraging SPCPs to Expand Access to Mortgages for Minorities and Low-to Moderate-Income Communities: 

SPCPs can be a valuable tool for borrowers who are looking to achieve homeownership. By providing more favorable terms and conditions, SPCPs can help borrowers overcome the financial barriers that have traditionally prevented them from owning a home. SPCPs are a tool that lenders can use to expand access to mortgage credit for underserved communities. This vehicle allows lenders to tailor their lending criteria to the specific needs of these communities and offer more favorable terms than would be available through traditional lending programs.

There are a number of ways that SPCPs can be used to expand access to mortgage credit. For example, SPCPs can:

  • Relax credit score requirements
  • Allow for alternative credit scoring methods
  • Consider nontraditional sources of income
  • Offer lower interest rates or other cost savings
  • Provide down payment assistance

SPCPs can be an effective way to help people who historically have not been able to qualify for a mortgage, such as homebuyers with lower credit scores, limited credit histories, or homebuyers who live in low-income communities.

More Information on SPCPs:

Special-Purpose Credit Programs:

The Newrez Family of Companies is committed to expanding access to affordable home financing solutions.

Freddie Mac BorrowSmart AccessSM Program:

This mortgage option is a SPCP designed to provide eligible first-time homebuyers with more flexible lending options and closing cost assistance. This program aims to address the specific needs of underserved communities and individuals who face unique challenges in obtaining mortgage financing.

This program aims to assist borrowers from traditionally underserved communities overcome one of the largest obstacles to homeownership by providing built-in assistance. This mortgage allows first-time homebuyers from select metropolitan areas to obtain funds to use toward their down payment or closing costs through combined contributions from Freddie Mac® and the approved lender, in exchange for the borrower completing homebuyer counseling through Freddie Mac BorrowSmart AccessSM.

Where is Freddie Mac BorrowSmart AccessSM Available?*

  • Atlanta-Sandy Springs-Apharetta, GA
  • Chicago-Naperville-Elgin, IL-IN-WI
  • Detroit-Warren-Dearborn, MI
  • El Paso, TX
  • Houston-The Woodlands-Sugar Land, TX
  • McAllen-Edinburg-Mission, TX
  • Memphis, TN-MS-AR
  • Miami-Fort Lauderdale-Pompano Beach, FL
  • Philadelphia-Camden-Wilmington, PA-NJ-DE-MD
  • St. Louis, MO-IL

How Our Organization Serves Underserved Communities:

We are not only a mortgage lender and servicer; we are agents of change. The Newrez Family of Companies is committed to making a meaningful impact, fostering inclusivity, and empowering individuals and communities to thrive through the power of homeownership. Join us as we work towards a future where homeownership is accessible to all, regardless of income or background.

Together, we can break down barriers and pave the way for a more inclusive housing market. Take the first step towards homeownership with Newrez, where we are committed to turning your homeownership dreams into a reality.

The Newrez Family of Companies is dedicated to transforming homebuyers into homeowners, one home loan at a time. Contact us today to learn more.


*Geographic restrictions apply. Down payment assistance products may have a higher interest rate or higher finance charges than other loan products which may be available.Fannie Mae® is a registered trademark of the Federal National Mortgage Association. Freddie Mac® and Freddie Mac BorrowSmart AccessSM are registered trademarks of the Federal Home Loan Mortgage Corporation.  The previously mentioned companies and programs are not affiliated with Newrez LLC.© 2023 Newrez LLC, 1100 Virginia Dr., Ste. 125, Fort Washington, PA 19034. 1-888-673-5521. NMLS #3013 ( is not a commitment to lend or the guarantee of a specified interest rate. All loan programs and availability of cash proceeds are subject to credit, underwriting, and property approval. Programs, rates, terms and conditions are subject to change without notice. Other restrictions apply.


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