Business Financial Services | IDA
Want to buy your first home, start a small business or go to school? The TAP IDA Program can help!
In June 2001, TAP started the Individual Development Accounts (IDA) program, a unique and innovative way to help families with limited income become first-time homeowners, start a small business or go to school.
What are Individual Development Accounts (IDAs)?
Individual Development Accounts (IDAs), are matched savings accounts. For every dollar a TAP IDA participant saves, TAP IDA will commit another 2 dollars to his or her total account balance to be used for one of the following purposes: first-time home purchase, small business capitalization or post-secondary education.
How Does it Work?
Participants set up a custodial account at a local participating bank, which currently include Wachovia, BB&T, First Citizens Bank, and Valley Bank. Custodial accounts mean that the participant is named as the beneficiary while TAP is named as the owner or custodian of the account (participants can get all of the savings back at any time for any reason if they do not want to participate any longer).
Participants save at least $20/month for at least 6 months and attend financial education classes and receive assistance in becoming a homeowner, small businessperson or going back to school. After they have fulfilled the requirements of the program and reached their savings goal, funds are withdrawn from their account and combined with TAP’s $2 to $1 match to be paid to the appropriate vendor (i.e. mortgage company, business equipment company or college).
Example
John saves an average of $40 a month for 18 months. He completes the financial education classes and homeowner education process, improves his credit rating by repaying some debt and pre-qualifies for a mortgage. At the end of 18 months, he has $720. TAP matches this amount with a 2:1 match, or $1,440. Thus, John has $2,160 to use toward the down payment on his home.
Community Partners
The IDA program received a commitment of $90,000 from the United Way of Roanoke Valley over the next 3 years to be used as savings matches for IDA participants. Nationally, United Way has been a leader in the field of IDA programs, supporting local programs in a variety of ways. The IDA program also received a matching commitment of $90,000 from the Department of Health & Human Services Assets for Independence Demonstration Program.
In addition to the participating banks listed above, several local organizations comprise the Roanoke Valley IDA Partnership, which makes decisions about the IDA program. These organizations include
Roanoke Redevelopment & Housing Authority,
Habitat for Humanity in the Roanoke Valley,
Blue Ridge Housing Development Corporation
Consumer Credit Counseling Service,
Roanoke Regional Chamber of Commerce,
Roanoke County Department of Social Services,
Member One Federal Credit Union
TAP’s Housing and Community Development
How Do I Sign Up?
Before applying for an IDA, you must:
1. Attend an orientation session
2. Attend a budgeting workshop
After you complete your application, you call TAP IDA to arrange an interview. After the interview, the Roanoke Valley IDA Partnership will review your application and make a decision whether or not to enroll you in the IDA program.
An ideal candidate for an IDA has:
∙ Enough money to save each month
∙ Stable source of income
∙ Stable life situation
∙ Good enough credit to allow them to pursue their goal
∙ Lives or wants to live in one of the priority neighborhoods
Contact Us
For more information, contact Teffany Henderson at 345-6781 x.4408 or teffany.henderson@taproanoke.org.
Want to Learn More About IDAs?
www.acf.hhs.gov/assetbuilding
www.cfed.org
www.financeproject.org
