In rural communities, the path to affordable homeownership is often blocked by systemic gaps in mortgage finance. Sylvia Rodriguez, a social studies teacher, and her mother, Thelma Saenz, a retiree, experienced these barriers firsthand. Living in Freer, Texas, a town of 2,500 residents in Duval County, Thelma could not afford to live on her own and needed the daily support of her daughter. Together, they sought a modest, safe home where they could live with dignity and stability.
They found a small wood-siding home priced at $50,000. While affordable, the home’s rural location and low price meant that traditional lenders would not finance it. Conventional mortgages generally exclude such homes, considering them too small or too risky. This left Sylvia and Thelma facing the very real prospect of being shut out of homeownership, despite their ability to manage payments.
Research confirms their struggle is not unique. The Urban Institute has found that small mortgage loan financing is limited, with applicants for these loans more likely to face denials compared to larger loan amounts (McCargo et al., 2018). Affordable housing supply is already constrained, and without small loan financing, families lose access to one of the few available options. Similarly, Pew research highlights that inadequate or hard-to-title homes make up 6% of buyable properties in rural areas, compared to 3% in urban areas—further shrinking the housing stock that qualifies for conventional financing.
Freedom Bank stepped in where others would not. Established in 1958 and headquartered in Alamo, TX, Freedom Bank is a Hispanic-led Community Development Financial Institution (CDFI) and Minority Depository Institution (MDI). The bank specializes in tailored solutions like portfolio mortgages for rural families, assistance with tangled title issues, and financing for manufactured and modular housing. By providing an in-house portfolio mortgage, Freedom Bank not only secured a stable home for Sylvia and Thelma—it demonstrated the critical role community banks play in addressing the broader affordable housing gap across rural America.
