In an effort to boost home ownership among its predominantly Black and Latino residents, Newark officials are deploying a little-used federal program that redirects housing subsidies toward mortgages instead of rent payments. 

On Wednesday, city officials closed on three new homes for low-income families, celebrating in front a newly renovated house in the South Ward.

"Home ownership is the largest reason that there's a huge wealth gap between Black and brown, and white families in America," Mayor Ras Baraka said. "The home ownership gap is huge and this is our opportunity to fill it."

Under the program, Newark has created a multi-agency partnership that includes Naca, a lender that approves loans based on a person's record of paying their bills on time and "character." The city then provides between $5,000-$10,000 of the applicant's down payment, while the Urban League of Essex County provides financial counseling to ensure the family can pay the mortgage amount not covered by the voucher.

"Our goal really is to help these homeowners own these homes free and clear and for that to happen, we have to not just put together a financial package to get them in the home, but we have to put together wrap-around services in order for them to stay in the home," said Bernel Hall, President and CEO of Invest Newark, the city's redevelopment arm. 

The mortgages last 15 years and Hall said the properties, which were formally abandoned, are deed restricted to encourage families to stay living in the city. They're also sold at much lower rates. Families will still have to pay 30% of their income toward their mortgage, just as they would if they used their Section 8 voucher toward rent. 

Only 22% of Newarkers own their homes. Hall said there are another 2,000 abandoned properties in the city and he hopes the program can turn many of those into new homes for families. 

"The program is amazing, a great opportunity for a lot of mothers like me, who felt like I could not own a home," said Ramona Addison, who will be moving into one of the properties next month. "I think it's doing a lot for Newark."