Washington State launches a racially targeted housing program offering $150,000 interest-free loans to minorities, sparking debate over whether it addresses historical wrongs or creates new divisions.
Quick Takes
- Washington’s Covenant Homeownership Program provides 0% interest loans up to $150,000 for down payments to specific racial groups only.
- Eligibility requires applicants belong to racial minorities whose ancestors lived in Washington before April 1968.
- The program aims to address stark homeownership disparities (34% for Black households vs. 69% for white households).
- Recent expansion includes loan forgiveness after five years for lower-income recipients.
- Critics argue the race-based approach constitutes reverse discrimination and could violate equal protection principles.
Race-Based Lending Program Details
Washington State launched the controversial Covenant Homeownership Program, offering zero-interest loans up to $150,000 to prospective homebuyers based explicitly on racial criteria. The program targets those who faced housing discrimination before the 1968 Fair Housing Act. Washington State Governor Bob Ferguson signed into law prioritizing down payment assistance for first-time home buyers if they meet a certain skin color. To qualify, applicants must have household incomes below the area median income (recently expanded to 120%), be first-time homebuyers, and crucially, belong to specific racial groups: Black, Hispanic, Native American, Alaska Native, Native Hawaiian, Pacific Islander, Korean, or Asian American.
The selection criteria require that applicants or their ancestors lived in Washington before April 1968. The program is funded through a $100 fee on recorded real estate documents, with loans becoming repayable when recipients sell or refinance their property. However, a recent expansion now includes loan forgiveness provisions after five years for households earning 80% or less of the area median income, essentially converting the loans to grants for lower-income participants.
WASHINGTON STATE
"Governor Bob Ferguson just signed into law changes to the most outrageous, illegal reparations program in the entire country. It now GIFTS down payments, averaging $120,000, to black first-time homebuyers without ANY proof of direct housing discrimination." pic.twitter.com/8azJk76nQS
— Republicans for Asotin County (@AsotinCountyGOP) April 28, 2025
Addressing Historical Disparities
The program was designed to address significant racial disparities in homeownership rates across Washington. Current statistics reveal only 34% of Black households and 48% of Hispanic households own homes compared to 69% of white households in the state. Program advocates point to these numbers as evidence of lasting impacts from historical discriminatory housing practices, including redlining and restrictive covenants that prevented minorities from purchasing homes in certain neighborhoods for generations.
Despite the ambitious goals, funding limitations mean the program can support only approximately 130 down payment loans at the maximum amount. However, state officials report the initiative has already helped over 200 families across more than 20 counties access homeownership, presumably through smaller loan amounts. Governor Bob Ferguson has championed the program as a tangible step toward addressing historical wrongs and creating wealth-building opportunities for marginalized communities.
Controversial Exclusions and Legal Questions
The program has generated significant controversy for excluding certain groups that also faced historical discrimination, such as Jewish Americans. When questioned about these exclusions, program administrators pointed to data limitations rather than principles of equal treatment. The Washington Housing Finance Commission defended their approach with a statement acknowledging the selectivity of their criteria.
Critics argue that the program constitutes reverse discrimination by prioritizing assistance based solely on race rather than economic need. Legal questions persist about whether such explicitly race-based government programs will withstand potential equal protection challenges, particularly in light of recent Supreme Court decisions limiting race-conscious policies in other contexts. Some opponents contend that the program rewards individuals who may not have personally experienced discrimination while penalizing others for actions they never committed.
Sources:
Washington state’s homeownership program offers loans based solely on race
Woke governor signs law providing assistance to first-time home buyers, provided they aren’t White
