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New Financial Education Program to Educate and Assist Prospective Homebuyers

"$2 Million Available Through Pilot Program" Today, the U.S. Department of the Treasury's Community Development Financial Institutions Fund (CDFI Fund) launched its new Financial Education and Counseling (FEC) Pilot Program with the submission of a fiscal year (FY) 2009 Notice of Funds Availability (NOFA) to the Federal Register. The launch of this new program will strengthen the CDFI Fund's support for a range of financial education and counseling services to prospective homebuyers and address critical financial literacy needs in the wake of the crisis in the housing market.

Announcing the new program, CDFI Fund Director Donna J. Gambrell stated, "I am excited to add a new program for promoting financial empowerment into the CDFI Fund's toolkit. By increasing financial knowledge and decision-making capabilities, the Financial Education and Counseling Pilot Program is geared to providing low-income and low-wealth individuals with the skills they need to make smart financial decisions. I have high hopes for the impact this program will have on both prospective homebuyers and providers of financial education."

"This pilot grant program will provide resources to support effective delivery of financial education and counseling to communities where it is most needed," said Michelle Greene, Treasury's Deputy Assistant Secretary for Financial Education and Access. "Capturing the findings from these pilots will help Treasury assess the effectiveness of various approaches to financial education, and build the knowledge of the field to continue to move ahead."

Financial Education and Counseling Pilot

Program Overview

The Financial Education and Counseling Pilot Program was authorized pursuant to Section 1132 of the Housing and Economic Recovery Act of 2008 (Pub. L. 110-289). In March of 2009, the CDFI Fund was appropriated $2 million for the implementation of this program. Grants awarded through the FEC Pilot Program will have the ultimate goal of identifying successful methods of financial education and counseling services that result in positive behavioral change for financial empowerment, and establishing program models for organizations to deliver effective financial education and counseling services to prospective homebuyers.

To achieve these purposes, the CDFI Fund will make awards to organizations that provide a range of financial education and counseling services to prospective homebuyers, with the goals of:

1) increasing the financial knowledge and decision-making capabilities of prospective homebuyers;

2) assisting prospective homebuyers to develop monthly budgets, build personal savings, finance or plan major purchases, reduce debt, improve financial stability, and set and reach financial goals;

3) helping prospective homebuyers improve credit scores by understanding the relationship between credit histories and credit scores; and

4) educating prospective homebuyers about the options available to build savings for short- and long-term goals.

Application MaterialsClick Here for FY 2009 FEC Pilot Program Application Materials.

Learn About Applying to the FEC Pilot Program
On Thursday, October 22, 2009 from 2:00 to 3:30 p.m. Eastern Time, the CDFI Fund will conduct a conference call for organizations interested in applying to, or learning about, the FEC Pilot Program.

Public participation will be limited to 150 individual phone lines. Multiple staff from the same organization are asked to call as a group from one phone line to maximize participation.
To access the conference calls, participants need to call (800) 988-9565 and enter in the pin number FECPP. No prior registration is necessary.

Questions?
For more information on the FEC Pilot Program, please contact the CDFI Fund by e-mailing cdfihelp@cdfi.treas.gov or by calling (202) 622-6355.

Background on the CDFI Fund
Since its creation in 1994, the CDFI Fund has awarded almost $1.2 billion to CDFIs, community development organizations and financial institutions through CDFI Program, the Bank Enterprise Award Program, and the Native Initiatives. In addition, the CDFI Fund has allocated $21 billion in tax credit authority to Community Development Entities through the New Markets Tax Credit Program.

Source: U.S. Department of State