The Functioning of NACA

Real Estate

NACA’s Fight Against Exploitative Lending

In 1988, Bruce Marks became involved with a hotel workers union in Boston to battle the issue of expensive housing, which hotel workers struggled to afford. His mission led to the creation of NACA, originally called the Union Neighborhood Assistance Corporation of America. This nonprofit now fights against exploitative lending practices by major banks that take advantage of borrowers who cannot afford their loans. NACA has been willing to do whatever it takes to create change, including picketing bankers’ homes and schools, interrupting stockholder meetings, and circulating private information about financial executives. NACA’s goal is to target greedy loan sharks and make them understand the pain and embarrassment that foreclosure brings to affected families.

NACA took on Fleet Bank and its subsidiary, Fleet Finance, for more than four years regarding their ties to exploitative lending. They staged demonstrations to turn the national media spotlight on Fleet, and when Marks testified before the U.S. House and Senate Banking Committees in 1993, he brought more than 400 people who had lost their homes due to Fleet’s practices. NACA orchestrated stunts such as publicizing then-chairman Alan Greenspan’s direct phone number when the Federal Reserve refused to meet with them or hold hearings on exploitative lending practices. Fleet finally agreed to invest $8.5 million in affordable lending to low- and moderate-income borrowers, commit $140 million toward NACA’s affordable home-ownership program, and provide appropriate restitution to affected borrowers and communities. Fleet Finance was shuttered as a result.

NACA also overturned a class-action settlement involving The Associates, the largest finance company in the United States in the late ’90s. The lawsuit would have provided The Associates with immunity while offering as little as $50 to borrowers who had lost homes. After a multi-year campaign and a 14-hour meeting, The Associates eventually invested $100 million in NACA’s mortgage program.

NACA also targeted First Union CEO Edward Crutchfield in an effort to get the bank to work with NACA. After a postcard protest, First Union settled with NACA, committing $150 million to its loan program.

NACA has focused on fighting against subprime lending and has joined forces with major banks to provide affordable mortgages and restructure loans for those at risk of losing their homes due to unfavorable deals. Citigroup pledged $3 billion to NACA in 2003, making NACA the first non-profit mortgage broker, and in 2014, Bank of America granted $10 billion in funds to NACA, allowing the agency to lend to about 50,000 homeowners on its own terms until 2024. NACA’s vision includes brokering other types of financial products such as car and student loans. Critics have accused NACA of targeting banks for money and delaying the lending process with paperwork, but the organization helps individuals who could not otherwise afford to buy a home. Regarding FAQs, NACA does not consider credit scores when applying for a mortgage, and there are no income limits for participation, though the organization primarily helps low to moderate-income earners. NACA’s services are free, but membership dues are collected from those in the Purchase Program and community members. To qualify for a NACA mortgage, you must meet specific requirements, such as occupying the home for the duration of the mortgage and not owning any other property.

Related Articles

• Learn How Purchasing a House Functions
• Learn How Mortgages Operate
• Learn How Subprime Mortgages Function

Additional Excellent Links

• Bankrate: Mortgage Payment Calculator
• U.S. News & World Report: 10 Terms First-Time Homebuyers Should Know
• Wall Street Reform: The Dodd-Frank Act

Sources

• Andriotis, Annamaria. “Citigroup and Bank of America Offer Mortgages With Discounted Rates.” The Wall Street Journal. Sept. 16, 2014. (Feb. 15, 2015) http://www.wsj.com/articles/citigroup-and-bank-of-america-offer-mortgages-with-discounted-rates-1410906909
• Appelbaum, Binyamin. “A Nonprofit Lender Revives the Hopes of Subprime Borrowers.” The New York Times. Feb. 25, 2014. (Feb. 15, 2015) http://www.nytimes.com/2014/02/26/business/a-nonprofit-lender-revives-the-hopes-of-subprime-borrowers.html
• Appelbaum, Binyamin. “Hub group, Countrywide in deal. Nonprofit will restructure some borrowers’ loans.” Boston Globe. Oct. 24, 2007. (April 1, 2008) http://www.boston.com/business/articles/2007/10/24/hub_group_countrywide_in_deal/
• Arnold, Chris. “New 15-Year Mortgage May Open Homeownership Door For More Buyers.” Oct. 3, 2014. (Feb. 15, 2015) http://www.npr.org/2014/10/03/353521437/new-15-year-mortgage-may-open-homeownership-door-for-more-buyers
• Bank of America. “Fixed-Rate Mortgages.” 2015. (Feb. 15, 2015) https://www.bankofamerica.com/home-loans/mortgage/fixed-rate-mortgage-loans.go
• Blanton, Kimberly. “Housing group helping on Citi loans.” Boston Globe. March 25, 2008. (April 1, 2008) http://www.boston.com/business/personalfinance/articles/2008/03/25/housing_group_helping_on_citi_loans/
• CBS4 Miami. “I-Team: NACA Investigation.” May 4, 2011. (Feb. 15, 2015) http://miami.cbslocal.com/2011/05/04/i-team-naca-investigation/
• Dvorak, John A. “Audit Report No. 2011 BO 1004: The Neighborhood Assistance Corporation of America Generally Administered Its HUD Grants Used for Housing Counseling Activities in Accordance with HUD Requirements.” Department of Housing and Urban Development (HUD). Feb. 16, 2011. (Feb. 15, 2015) http://www.hud.gov/offices/oig/reports/files/ig1111004.pdf
• ElBoghdady, Dina and Nell Henderson. “$1 Billion Pledged to Help Fend Off Foreclosures.” Washington Post. April 12, 2007. (April 1, 2008) http://www.washingtonpost.com/wp-dyn/content/article/2007/04/11/AR2007041102200.html
• Experian. “What Is a Good Credit Score?” 2015. (Feb. 15, 2015) http://www.experian.com/credit-education/what-is-a-good-credit-score.html
• Hogberg, David. “NACA Imitates ACORN’s Brutal Shakedown Tactics.” Human Events. April 23, 2009. (Feb. 15, 2015) http://humanevents.com/2009/04/23/naca-imitates-acorns-brutal-shakedown-tactics/
• Hudson, Michael. “‘Banking terrorist’ fights for poor.” The Progressive. October 1997. (April 1, 2008) http://findarticles.com/p/articles/mi_m1295/is_n10_v61/ai_19841057/pg_1
• Husock, Howard. “The Trillion Dollar Shakedown that Bodes Ill for Cities.” City Journal. Winter 2000. (April 1, 2008) http://www.city-journal.org/html/10_1_the_trillion_dollar.html
• Lamb, Lori. “What is a good credit score? [Infographic].” Springboard Nonprofit Consumer Credit Management – Credit.org. Jan. 22, 2014. (Feb. 15, 2015) http://credit.org/blog/what-is-a-good-credit-score-infographic/
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• Neighborhood Assistance Corporation of America (NACA). 2015. (Feb. 15, 2015) https://www.naca.com/nacaWeb/index_main.aspx
• Neighborhood Assistance Corporation of America (NACA). “NACA Qualification Criteria.” Ver. 13.2. (Feb. 15, 2015) https://www.naca.com/nacaweb/purchase/nacaQualificationGuideLines.pdf
• Rothacker, Rick. “Foreclosure-Prevention Roadshow Still Drawing Crowds Indicating Not All Is Well In The Housing Market.” Reuters. Dec. 7, 2012. (Feb. 15, 2015) http://www.huffingtonpost.com/2012/12/07/foreclosure-prevention-roadshow_n_2262973.html
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FAQ

1. What is NACA?

NACA stands for National Advisory Committee for Aeronautics. It was a US federal agency that existed from 1915 to 1958, responsible for conducting research and development in the field of aeronautics.

2. How did NACA contribute to aviation?

NACA made significant contributions to aviation by conducting research on aerodynamics, aircraft design, and propulsion. Their work led to the development of more efficient and safer aircraft, including the first supersonic aircraft, the Bell X-1.

3. When was NACA established?

NACA was established on March 3, 1915, by an act of Congress, in response to the growing need for a centralized agency to oversee the development of aviation technology.

4. How was NACA organized?

NACA was organized into several research laboratories, each focused on a specific area of aeronautical research. These included the Langley Aeronautical Laboratory, the Ames Aeronautical Laboratory, and the Lewis Flight Propulsion Laboratory.

5. What was the significance of the Langley Aeronautical Laboratory?

The Langley Aeronautical Laboratory was the primary research facility of NACA. Its researchers made significant contributions to aviation technology, including the development of the NACA airfoil series, which revolutionized aircraft design.

6. Why was NACA disbanded?

NACA was disbanded on October 1, 1958, when it was replaced by the National Aeronautics and Space Administration (NASA). The decision to disband NACA was made in response to the growing importance of space exploration in the 1950s.

7. What was the legacy of NACA?

The legacy of NACA is significant, as it laid the foundation for modern aviation technology. Its research and development efforts led to the development of safer, more efficient aircraft, and paved the way for space exploration.

8. What were some of NACA’s most significant achievements?

Some of NACA’s most significant achievements include the development of the NACA airfoil series, the design and testing of the Bell X-1 supersonic aircraft, and the development of the first wind tunnel.

9. Who were some of the notable researchers at NACA?

Some of the notable researchers at NACA include Robert T. Jones, who developed the swept-wing design, Theodore von Kármán, who developed the von Kármán vortex street theory, and Katherine Johnson, who calculated the trajectories for space missions.

10. How did NACA influence the space race?

NACA’s research and development efforts paved the way for space exploration, and many of its researchers and engineers went on to work for NASA. The knowledge and expertise gained by NACA were essential to the success of the space race.

11. How did NACA contribute to aviation safety?

NACA’s research on aerodynamics and aircraft design led to the development of safer and more efficient aircraft. Its work on wind tunnels and flight testing also contributed to the development of safety standards and procedures in aviation.

12. What is the significance of NACA today?

Although NACA no longer exists, its legacy lives on in the modern aviation industry. Many of the technologies and design principles developed by NACA are still in use today, and its research and development efforts continue to influence aviation and space technology.