Appendix G: IDA Asset Cost Due Diligence Worksheets PDF Version (41KB)
	Asset Goal: Home Ownership Asset Goal: Education Asset Goal: Microenterprise

Here are individual work sheets for each asset goal: home ownership, business, and education. The sheets will help you organize available information on the actual cost of the assets in your own community. You may find that a particular asset goal, such as homeownership, may not be realistic for the population you plan to target, or you may find there are additional resources to complement the AFI project funds and participant savings that make an asset purchase possible. You may also find that if your own organization lacks experience in an asset area, that there are many other sources from which to gather information that will be useful, not only in estimating actual purchase costs but also in developing policies and procedures to support your participants on whichever path they choose to travel.

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Asset Goal: Home Ownership

Asset Goal: Home Ownership Tables 1-4 (Excel 21KB)

1. Estimate the approximate selling price of homes in your community.

	Estimate cost according to.
	local affordable homeownership program	local real estate professional	review of real estate ads in local newspaper
For a family of two	$	$	$
For a family of three	$	$	$
For a family of four	$	$	$

 

2. Estimate the size of a typical down payment (as a percentage of a home's selling price).

	Estimate down payment % required according to.
	a commercial bank or mortgage company	a community development credit union	a local affordable homeownership program
With excellent credit	%	%	%
With average credit	%	%	%
With marginal credit	%	%	%

 

3. Estimate typical closing costs involved in purchasing a home in your community.

	Estimate according to.
	a commercial bank or mortgage company	a community development credit union	a local affordable homeownership program
Home inspection	$	$	$
Attorney's fees	$	$	$
Title Fees	$	$	$
Lending Fees	$ -or- %of loan:	$ -or- %of loan:	$ -or- %of loan:
Insurance Deposit	$	$	$
Other	$	$	$
Total:

 

4. Estimate the value of homebuyer grants, subsidies or other program in your community.

		Potential home buyers' grants or subsidies according to.
		bank, credit union or mortgage company	federal, state or local gov't agency	affordable homeowner program
Reduced down payment requirement	program name
	required down	%	%
	eligibility
Subsidies or reduced mortgage rate	program name
	subsidized rate	%	%
	who's eligible
Grants or down payment assistance	program name
	assistance amount	$	$	$
	who's eligible
Other programs	program name
	description
	who's eligible

 

5. Calculate the total acquisition costs for homes in your community.

	For a household of 2 (# of bedrooms?____)		For a household of 3 (# of bedrooms?____)		For a household of 4 (# of bedrooms?____)
Selling Price	$	$	$	$	$	$
x Down payment %	%	%	%	%	%	%
= Down payment $	$	$	$	$	$	$
Total Closing Costs	$	$	$	$	$	$
Less Grants/Subsidies	($         )	($         )	($         )	($         )	($         )	($         )
Net Acquisition Cost *	$	$	$	$	$	$

* Net Acquisition Cost = Down Payment + Closing Costs - Grants or Subsidies

Once you've calculated acquisition costs, it is important to consider the corresponding total mortgage amount (cost of the home less down payment) and monthly mortgage payment in order to see if families in your program would be able to support the on-going costs of homeownership. Consult a financial institution or use a computer spreadsheet (or online mortgage calculators) to estimate monthly payments for mortgages of different sizes. Add home maintenance and utility costs, which should be discussed in home ownership classes offered as part of asset-related training. Factor in taxes and insurance if your mortgage source or calculator does not.

6. Review on-going costs of homeownership that the acquisition costs you've calculated suggest.

	For household of two		For a household of three		For a household of four
	Low Estimate	High Estimate	Low Estimate	High Estimate	Low Estimate	High Estimate
Selling Price:	$	$	$	$	$	$
Less Down payment	($         )	($         )	($         )	($         )	($         )	($         )
= mortgage payment	$	$	$	$
Mortgage rate	%	%	%	%	%	%
Monthly payment on. a 20-year mortgage:	$	$	$	$	$	$
a 30-year mortgage:	$	$	$	$	$	$
Adjustable Rate Mortgages (ARM'S)	$	$	$	$	$	$
Monthly mortgage payment + taxes, insurance, maintenance, utilities	$	$	$	$	$	$

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Asset Goal: Education

Asset Goal: Education Tables 1-4 (Excel 21KB)

1. Estimate the cost of post secondary courses of study, including tuition, fees, school-related expenses, and living expenses by calling local schools and vocational training programs.

	Costs to pursue.
	a 2-year AA degree at a community or junior college specify: (_________)	a 4-year degree at a state college specify: (_________)	Post graduate degree/study at a state college specify: (_________)	a professional or trade credential at a vocational training program - specify: (__________)
Tuition and fees	$	$	$	$
School expenses (books, supplies, etc.)	$	$	$	$
Estimated living expenses	$	$	$	$
Total cost	$	$	$	$

 

Note: AFI generally does not cover living expenses, but factoring in these costs (e.g., childcare, transportation, housing, etc.) while in school will help the participant come to a realistic budget.

2. Estimate available grants, loans (Federal, state, institutional), or other forms of financial aid.

		Available grants or support for.
		a 2 year AA degree	a 4 year degree	post graduate degree/study	a professional or trade credential
Aid from individual schools	Grant program
	Amount	$	$	$	$
	Eligibility
State education financing agency	Grant program
	Amount	$	$	$	$
	Eligibility
Federal aid programs	Program
	Amount	$	$	$	$
	Eligibility
Other aid programs	Program
	Amount	$	$	$	$
	Eligibility

Note: Participants may quickly learn the amount of Federal aid (grants or loans) for which they are eligible by filing the FAFSA (Free Application for Federal Student Aid). Go to www.studentaid.ed.gov for the forms and links to advice on the Federal study.

 

3. Calculate total cost of obtaining post-secondary education.

	Total net cost to obtain a.
	a 2-year AA degree	a 4-year BA degree	post graduate degree/study	professional or trade credential
Total cost	$	$	$	$
Less grants	($         )	($         )	($         )	($         )
Net cost	$	$	$	$

It may be helpful to work out the above steps in terms of individual semesters or quarters or other enrollnent periods, especially for adults interested in vocational training and specific skills linked to job advancement.

Once you've calculated the cost of obtaining postsecondary education or training, it is important to consider whether IDA participants would be able to support the on-going monthly cost of repaying education loans, if these are part of the overall budget.

4. Review on-going monthly education loan repayment costs.

	Total net cost to obtain a.
	a 2-year AA degree	a 4-year BA degree	post graduate degree/study	professional or trade credential
Total amount borrowed to finance education:	$	$	$	$
Loan financing rate:	%	%	%	%
Monthly payment on loans with a 10-year term:	$	$	$	$
Monthly payment on loans with a 15-year term:	$	$	$	$

What level of income would be necessary to support these monthly loan payments? Can people with degrees or certifications used on your worksheet above find jobs in your community that provide an income of the necessary level?

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Asset Goal: Microenterprise

Asset Goal: Microenterprise Tables 1-4 (Excel 19KB)

1. Estimate the total amount of start-up capital required by low-income entrepreneurs launching microenterprises in your community.

	Average required start-up capital according to:
	local microenterprise program		small business administration lender		bank or community development credit union
	Low Estimate	High Estimate	Low Estimate	High Estimate	Low Estimate	High Estimate
Service-based business	$	$	$	$	$	$
Manufacturing business	$	$	$	$	$	$
Retail business	$	$	$	$	$	$

 

2. Estimate the percentage of total start-up capital an entrepreneur must have "in-hand" in order to qualify for a start-up loan or other financing.

	Percent of total capital required to quality for financing according to:
	local microenterprise program		small business administration lender		bank or community development credit union
	Low Estimate	High Estimate	Low Estimate	High Estimate	Low Estimate	High Estimate
Service-based business	%	%	%	%	%	%
Manufacturing business	%	%	%	%	%	%
Retail business	%	%	%	%	%	%

 

3. Estimate the value of available microenterprise grants or subsidies in your community.

		Potential microenterprise grants or subsidies according to.
		local microenterprise program	small business administration lender	bank or community development credit union
Capital grants or cash assistance	program name
	required down	$	$	$
	eligibility
Subsidies or reduced rate loans	program name
	subsidized rate	%	%	%
	who's eligible
Other programs	program name
	description
	who's eligible

 

4. Estimate the total cost to start up a microenterprise in your community.

	Service-based business		Manufacturing business		Retail business
	Low Estimate	High Estimate	Low Estimate	High Estimate	Low Estimate	High Estimate
Total start-up capital requirement	$	$	$	$	$	$
% of capital needed to qualify for financing	%	%	%	%	%	%
Grants / Subsidies:	($         )	($         )	($         )	($         )	($         )	($         )
Net start-up Cost *	$	$	$	$	$	$

* Net start-up Cost = Total Start-up Capital x % of Capital Needed to Qualify for Financing - Grants/Subsidies

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