Story Photos
 Tamy Gonzales and her son, Loren, 17, have enjoyed owning their own home for four years since she enrolled in an Individual Development Account through CAP to save for the down payment. Two older sons, 20 and 19, have since moved out and are on their own. Bill Wagner / The Daily News
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Saving grace: CAP program promotes success through money management
Tuesday, August 19, 2008 11:32 PM PDT
By Cheryll A. Borgaard
Printable version
E-mail this articleTamy Gonzales never dreamed she’d be a homeowner. Richelle Ellison never dreamed she’d own a computer to help with her college education. But both Longview women were able to realize their goals by participating in program that turns debtors into savers.
Gonzales was and Ellison is a participant in the Individual Development Account program through Lower Columbia CAP. IDAs are special matched savings accounts to help low-income families and individuals establish a pattern of regular saving. Participants can use their savings and matched funds toward a home, start a small business or college or vocational school.
Gonzales, a single mother of three, had gone to the Longview Housing Authority about 1998 for help with housing. She qualified for HUD assistance two years later. Meanwhile, she began to work on cleaning up her credit and paying off bills in preparation for buying a home, which took five years.
“The reason I went to IDA was because I didn’t have a down payment,” said Gonzales, 42, who has worked as an in-home caregiver for 10 years.
Potential homeowners must save $2,000 toward their down payment. Federal and state funds match an additional $4,000. It took Gonzales about 1 1/2 years to save her portion.
“I had to deposit $80 per month into my account,” she said. “I also added a couple larger amounts, like my tax return.”
She only dipped into her IDA savings one time before she had the required $2,000 and that was to buy school clothes for her sons. “And I paid it back as soon as I could.”
Her regular trips to the bank had an unexpected result: a more respectful attitude from bank personnel and a loan officer willing to give her a chance.
“Tamy was one of those who had a $5 savings account so she could cash her paycheck,” Liz Myntti, IDA program manager for CAP said. “With her diligence about putting money into her IDA, the bank said, ‘We can see you are responsible and serious about this.’ As it was, they approached her about applying for a loan.”
“The bank gave me an appraisal of what I could afford to pay,” Gonzales said. She qualified for $105,000, and in May 2004, working through a Realtor, she found a three-bedroom home on Cypress Street for her and her three teenage sons.
“I couldn’t believe that I found a house within the budget they gave me,” she said. “I still couldn’t believe it was my house until I signed at the title company.”
The state has had IDAs since 2001, Myntti said. “Every year, we go to the Legislature and tell them of the success stories like Tamy’s and the long-term benefits for low-income people. They’ve given us $1 million every two years, which is divided among 11 IDA programs statewide. Locally, we get $90,000 every two years and we anticipate to be re-funded at the same level in 2009.”
Most state IDAs match one-for-one, but CAP’s is one of four IDA programs in Washington to access federal funds, Myntti said. In July 2007, CAP received a five-year grant of $450,000. As a result, CAP IDA dollars are matched two-for-one. IDA matching funds are paid directly to the financial institution, college or vendor and not to the participant, Myntti said.
Since 2001, CAP’s IDA partipants have accounted for more than $3 million in assets in Cowlitz County, she said.
People have to save in their IDA for six consecutive months minimum before they can get matching dollars; such was the case for Ellison, who has had an IDA since January.
“I’m using it for education,” said Ellison, 52, a junior at WSU Vancouver majoring in human development and family therapy. “I had $300 in my savings and they matched $600 so I could pay off my computer. So, I’m at zero again in my IDA, but I have 28 months (of eligibility) left. The computer was a blessing. You have to have a computer to be a student.”
Ellison said she’s been married and divorced four times, has been to jail and prison on drug-related charges, has struggled with alcohol and drug abuse and readily admits she made poor choices along the way. She currently is in Drug Court, where she will graduate in October, and is “serving the Lord.” She’s been clean and sober since May 14, 2007.
She credits the discipline of the IDA program as part of her recovery. “You have to be accountable,” she said. “The best thing about the program is teaching me the value of savings, which I’ve always know, but wasn’t always able to do.”
Ellison receives HUD assistance for housing and has also qualified for federal student aid for school. She must fill out a Free Application for Federal Student Aid (FAFSA) each school year to determine how much she’s eligible for.
She said she’ll get about $9,000 in grants and loans when school begins Aug. 25. “About half goes to tuition, books. The rest is for living expenses. I divide that up for the months of the semester and make sure I put $55 into my IDA each month.”
For education, the IDA allows withdrawal in increments. “Next September I’ll have $500, and IDA will match with $1,000, so I don’t have to take out so much in student loans. I’m trying to keep loans around $10,000 by the time I graduate with my bachelor’s in December 2009.”
Gonzales and Ellison said they are thankful for the programs, like IDA, that are helping them change their lives.
“Part of what I am today is to be hope for others,” Ellison said. “We have a lot of programs to help people in Cowlitz County, and it’s just a matter of getting the information out there.”
“People just think, ‘oh they’re just low-income people. They don’t deserve nothing,’ “ Gonzales said. “HUD is the only thing I’m on now and I have state medical for my son that’s still at home. I’m off food stamps. This January was the first year I didn’t go to get help from CAP with my PUD bill.”
“If it wasn’t for the group of people who had faith in me, (buying a house) wouldn’t have been possible,” she said.
“I’m getting on my feet, stepping up. I say, just give us a chance.”
Get involved
Lower Columbia Community Action Program (CAP) currently has 10 openings in its Individual Development Account program that helps people save for homeownership, education or starting a small business. The three-year program allows up to $4,000 in matching funds (after participant has saved $2,000) toward purchase of a first-time home, small business start-up or college education. A requirement of IDA participation is to attend money management classes and show commitment to achieving one of the three goals.
For information or to see if you are qualified, visit the CAP office at 1526 Commerce Ave., Longview, or call CAP at (360) 425-3430. Applications also are available online at www.lowercolumbiacap.org. Click on “Programs” then “Career & Family Development.”
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