Fatuma Hussein Bright Lukasa Heidi McCarthy...Review our shared goals, timeline and process Share the expectations and seek commitments Planning team expands- new/all partners meet

Planning Team

Heidi McCarthy Economic Development Specialist

City of Lewiston

Bright Lukasa Training Coordinator

Immigrant Resource Center of Maine

Fatuma Hussein Executive Director

Immigrant Resource Center of Maine

Shanna Cox Executive Director

LA Metro Chamber of Commerce

Christine Hufnagel Director of Family Services

Community Concepts

Jennifer Hogan President/CEO

Community Credit Union

Claude Rwaganje Founder/Executive Director

ProsperityME

Shawn Yardley CEO

Community Concepts

Clement Yombe Program Director

ProsperityME

Misty Parker Economic Development Manager

City of Lewiston

Kayleigh Ogden Asset Quality Specialist

Community Credit Union

Partnering for Economic Security

A partnership for the unbanked and underbanked of LA

Partnership Goals: Develop trust and relationships among the partners and broader community of LA.

Address the needs of New Americans and low-income community members who are unbanked or underbanked in LA.

Co-design, test and pilot financial products and services that include financial literacy, serve the needs of the community, and manage risk for the institution.

Partnership Deliverables: A loan product that integrates financial literacy and addresses the need for securing

housing: Rental Loan Product.

A loan product that integrates financial literacy and addresses the need for securing

reliable transportation: Reliable Auto Loan Product.

A loan product that integrates financial literacy and addresses the need for managing

emergencies and crisis: Emergency Loan Product.

An outreach strategy that ensure each of the above products are accessible and know to

New Americans and low-income members of the LA community.

Planning Team Role: The planning team will consist of 6-8 individuals, with no more than 2 representatives from any partner organization. The planning team will work to maintain the overall momentum and pace, ensure the overall goals are being met, and coordinate the inclusion of additional perspectives as needed for the areas of designing products by topic (rental deposit, transportation, outreach, crisis/emergency).

Planning team members should:

Share the partnership’s goals,

have connections to either or both New Americans and low-income community members,

be able to make the commitment to the time and effort needed to ensure pilot testing occurs in the fall (estimated at 2 two-hour meetings a month, and up to 3 hours of time for tasks outside of meetings).

DRAFT Timeline for Partnership Activities

Planning to partner

ID future partners

Overview timeline and goals

Planning Team Meeting- planning Invitation to Partner with CCU and

ProsperityME reps.

Invitation to partner #1

Review our shared goals, timeline and process

Share the expectations and seek commitments

Planning team expands- new/all partners meet for Partner Meeting #2

Partner Meeting #2

Process Details- brainstorm and agreement- sequence products

Our commitments- to communication, meeting/the work, products lines

Planning Team Meeting(s)- plan format for co-design and testing, apply to each

of 3-8. Planning team will invite to a portion of the meetings 3-8 additional

perspectives related to the product being designed.

Partner Meetings #3-#8 Product Co-design and testing

#3: Product 1- co-design brainstorm

#4: Product 1- testing and refining

#5: Product 2- co-design brainstorm, Product 1 updates

#6: Product 2- testing and refining, product updates

#7: Product 3- codesign brainstorm, Product 1&2 updates

#8: Product 3- testing and refining, Product Outreach, Product updates

Planning Team Meeting(s)- plan for outreach

Partner Meeting #9: Outreach strategy/kick-off

5/21

EARLY JUNE

MID/LATE JUNE

JULY

AUGUST

NOVEMBER

DECEMBER

Programs for Economic Security – Reliable Auto Loans

This loan program is designed for individuals who do not meet our normal underwriting criteria (please see below). It’s specifically designed with the following in mind:

New Mainers

Low Income Individuals

Sub-Prime Borrowers (credit score of 600 or below)

Borrowers with no credit history Guidelines for Reliable Auto Loan Program (would like to come up with a name to better brand it): Criteria The below criteria will be used to determine is someone qualifies for this program. Details of each criteria indicate the Credit Union’s preference for the specific criteria. If they do not meet those details, the loan may be denied.

Criteria

Credit Score Range 600-639 / No Score 550-599 549 and lower

Maximum Debt-to-Income 42% 40% 38%

Length of Residence Less than 2 years Less than 2 years Less than 2 years

Length of Employment 6 months to 2 years, will

consider temp if it has

been continuous

1 year to 2 years, will


been continuous

Minimum 2 years

Bankruptcy Must be discharged with

no derogatory after

discharge

Must be discharged with

no derogatory after

discharge


no derogatory after

discharge

Repo/Foreclosure No more than 1 of each No more than 1 of each No more than 1 of each

Length in File 0 months 0 months 0 months

Tax Liens Maximum $2,500, must

be in repayment

Maximum $2,500, must

be in repayment


be in repayment

Collections/Judgments No trade line greater

than $5,000 derogatory

in last 12 months

(excluding medical)

No trade line greater


in last 12 months

(excluding medical)



in last 12 months

(excluding medical)

If 2 or more of the above criteria exists, the Underwriter may approve the loan with the stipulation of

adding Auto Loan Protection as a condition of the loan. Auto Loan Protection is an insurance product

purchased by the Credit Union on behalf of the member that purchases repossessed vehicles based on

guaranteed vehicle values less collision damage, mechanical defects, or excess mileage. To reduce

further deficiency balances, the program provides principal balance reduction payments to a maximum

of $5,000. If Auto Loan Protection is required as part of the loan, Auto Loan Protection will be disclosed

on the loan note as a pre-paid finance charge.

Stipulations

When being approved for this program, the following stipulations will be made with the loan. These stipulations are in place to ensure protection for the member (ensuring they get good collateral) and to ensure protection and mitigate risk for the Credit Union.

Stipulations

Score Range 600-639/No Score 550-599 549 and lower

Minimum Loan Amount $250 $250 $250

Maximum Loan Amount $18,000 $15,000 $12,000

Payment-to-Income 25% 20% 20%

Loan-to-Value Used – 100% NADA

New – 100% MSRP

Used – 100% NADA

New – 100% MSRP

Used – 100% NADA

New – 100% MSRP

Age of Collateral 10 years or less 10 years or less 10 years or less

Mileage of Collateral Less than 110,000 miles Less than 110,000 miles Less than 110,000

miles

Minimum Rent Applied to DTI $400, unless proof $400, unless proof $400, unless proof

Income Requirement POI required POI required POI required

References Minimum of 3 per

applicant

Minimum of 3 per

applicant

Minimum of 3 per

applicant

Misc Insurance verification in

file

Insurance verification in

file

Insurance verification

in file

The Underwriter has the authority to make exceptions to not apply this risk mitigation tool to current members with prior loans and positive repayment histories with the Credit Union. Additional Considerations

Financial Literacy should be incorporated into these programs. Our concern with it being a requirement is that we stop someone in an emergency situation from getting to where they need to be.

We would like to consider requiring a mini-financial literacy training into each loan closing that meet the above criteria. Our concern is our staff capacity (consider a partnership or joint-grant opportunity with ProsperityME to hire someone for this capacity).

We would be willing to offer a 2% rate discount for those who qualify for this program and complete, prior to the loan, a complete financial literacy program (consider a partnership with ProsperityME to use their class for this purpose, consider a joint-grant opportunity with ProsperityME to hire someone for this capacity). A floor rate of 3.00% would apply.

We would be willing to offer a 1% rate discount for those who do not qualify for this program but complete, prior to the loan, a complete financial literacy program (consider a partnership with ProsperityME to use their class for this purpose, consider a joint-grant opportunity with ProsperityME to hire someone for this capacity). A floor rate of 3.00% would apply.

Current Underwriting Considerations: Credit Report:

Time in file

Credit score

Payment history

Public records (civil judgments, bankruptcies, tax liens, etc.)

Inquiries

Types of loans

Look at oldest trade-line and

number of trade-lines

Job/Income:

Length of employment

Salary

Position advancement

Stability

Future pay increase

Total debt ratio

Unsecured debt ratio

Disposable income

Account Relationship:

How long a member

Savings and checking balances

Checking account behavior (NSFs)

Payroll deduction

Payment history on existing loans

Spending behavior (checking and credit cards)

Family connections

Level of money management skill Other Factors

Length and type of residence Guidelines:

Total secured debt load 50% of annual

gross income (does not include mortgage)

Payment to income

Underwriting Sub-Prime Borrower Considerations:

Debt to Income (DTI):

As a general guideline, DTI shouldn’t exceed 35% - 40% of gross income for C, D and E borrowers.

DTI should be dependent on disposable income. Higher disposable income can mean lower DTI. Sometimes DTI can be overstated when there is unreported income such as a roommate sharing monthly rent. The credit union may want to consider if it feels reasonably assured the roommate, etc. would continue for the foreseeable future.

If DTI exceeds 40%, we should determine the affordability of the loan for the borrower Payment to Income (PTI):

As a general guideline, PTI shouldn’t exceed 15 to 20% of gross income for non-prime borrowers. PTI should consider where members are in their financial lives.

First-time buyers may have higher PTIs if they are not yet paying rent or a mortgage payment.

Retired members may have higher PTIs if they own their homes free and clear. Other Considerations:

Affordability should include consideration of maintenance and repairs for the car. It is recommended cars not be older than 7 years and not have more than 125,000 miles.

Has the borrower handled similar payments in the past? Be very cautious if the payment is much larger than any previous loan payments.

Credit Score: Are scores on the way up or down?

A perfect payment history today but with escalating debt could mean a score on the way down and higher risk.

Some negatives in past credit history but the borrower is managing credit today could mean a score on the way up and lower risk.

How many recent inquiries has the person had? The average consumer has one inquiry per year. However, several inquiries for the same product over a brief period, such as two weeks, may reflect either an astute shopper or a person that has shopped around and has been declined by several lenders.

Bankruptcy indicators: o Excessive unsecured debt; o Maxed out revolving credit; o Escalating debt.

Negative Credit:

How old are the negative items? How far past due are these items? What has been happening in the past 12 months? If older than 12 to 18 months, but the borrower is paying other creditors today, is it time to forgive the past?

Are there liens and judgments? These result in wage garnishments and indicate higher risk.

How large are the medical collections? Don’t sweat the small stuff, but large dollar amounts may indicate a potential bankruptcy.

If the person has had a recent bankruptcy and the credit union did not lose money from it, the person may be a good risk today.

How has the person paid on previous car loans? Many people will overlook other loan but keep their car loans current because they need a car to get to work each day.

Has the person had previous credit with the credit union? How has he/she paid the credit union? If the record is good, then he/she will likely continue to pay the credit union. If there were some collection issues in the past, check with your collector for an opinion about the borrower.

FICO scores < 620:

The borrower’s relationship with the credit union can play a key factor here. How long has he/she been a member? Does the person have direct deposit and checking with the CU? How does the person manage his/her checking account?

Is the borrower’s score improving? What has caused the low score?

What is the borrower’s employment history? Frequent job changes or a short time at present job should be a red flag, although today’s job struggles could be a suitable explanation.

Several 30-day late payments describe a different behavior than a similar FICO score that results from several credit cards that have reached their maximum limits.

How can the loan be strengthened?

Borrowers in this category should have extensive verification of employment, income, address, phone numbers, and references.

Call references if necessary and verify accuracy of phone numbers and relationship with the borrower.

If a renter, can the borrower provide a record of on-time payments or a letter from the landlord stating his/her record of payment? Ask for utility payment records.

Employment:

Less than 6 months employment: o Definitely a cautionary flag – but what was the borrower’s previous employment

history? o Is this job better than the previous one with more income or opportunity? o Was the person laid off from a previous job? Does this appear to be a temporary job

until something better comes along? If so, would that strengthen the borrower’s ability to repay?

o What is the borrower’s relationship with the credit union? Is there a history of direct deposit and other services used by the borrower?

o Can the loan be strengthened in some other way?

Self-employment: o Definitely a cautionary flag – but how long has the person been self-employed? o The standard approach of requiring two years of tax returns and a profit and loss

statement may not be reasonable for many people new to self-employment. o Does the person have a business account and can he/she provide a record of business

deposits, expenses, or reference letters from clients? Is there a website, etc.? o A self-employed borrower with a credit score under 620 is a very different risk than a

self-employed borrower with A or B credit. Can the loan be strengthened in some other way?

Partnership for Economic Security

Feedback from Focus Group on Rental Security Deposits

Direct Experience

1. What is the amount of financial support that is often needed to establish new housing? (this could include the first, last and security deposit, costs for moving, costs to establish utilities, and more.)

$2,000-$3,500 = $4,500 (includes utilities $40-$80). Furniture, moving, first month, last month, security deposit)

3 months rent

Dishonest landlords raises prices

Rented house adds expenses – water, trash, snow removal

2. When you need funds for securing new housing, how long do you have to secure the additional funds you need? (prompt: Proactive planning or emergency to address housing)

First come, first serve

72 hours

Call landlord to confirm credit union is working the loan – approval letter, close within 24 hours

Trigger for emergency loan, need for rental to raise dollar amount

Other solutions - don’t want to get in over their head due to amount

3 months before lease expires they are looking for new place

3. What have been the challenges you faced in the past when securing funds for new housing?

Single mom/not working

Size of housing vs family size (5+ kids)

Vacancy/access

Language – landlords neglect to share vacancy when they hear someone’s accent

Relocation – job in Portland, vacancy elsewhere, not close proximity

Navigating resources

No SSN – this is based on financial institution policy

Past records (financial/credit and criminal)

4. What steps would you be willing to take if it strengthened your ability to get a loan? Examples include completing a financial literacy class, establishing an account and relationship at a financial institution, providing additional information about regular payments to your landlord, electric, or cable/internet payments.

Open account – no monthly fee

Direct deposit

Financial counseling (1:1)

Interest, high interest

Term of repayment (too short = deal breaker)

Affordable payment – based on income and DTI

Loan fee okay (CEI), flat fee(?)

Repayment deferment window

5. Outreach

Community member employed at CCU

Local organization recommendation (trusted source)

Personal

CCU go to the community (provide presentation) o Church o Local organization o Faith network o Post cards don’t work o Referral program o Community ambassador o Email (what and why must be clear) o In-person presentation (no longer than 10 minutes, be patient with responses) o CCU sponsor happy moment events (Block Party, Soccer) o Prove the value and difference of the loan product o Make sure loan product is known

Providers

1. When assisting people with securing housing, what are the biggest factors that are considered? What are the financial barriers to securing housing? What has led to success? (Prompts: Ability to pay first and last, ability to afford utilities)

No credit

Damaged credit

Past debt (unpaid utilities)

Need 1st month and security deposit

History of jail time, background check

Language barriers

House/Building code violations

Lead issues (Lead free vs Lead safe)

Finding an apartment without a security deposit

No income

Can’t get loan, so SSN for opening account (this is per institution policy)

Long wait for Asylum seekers

GA would consider income is payable to applicant

GA would consider liability if payable to landlord for the security deposit, rent, etc

One-year leases

Can’t get security deposit back (damages, break lease, etc)

Youth/age barrier

Finding safe housing

No rental history or poor history (ie – evictions, poor pay)

2. How often- if ever- do low-income people or new Americans work with a financial institution in securing funds? What trends or patterns do you see about the type or location of institutions? What role does translation or interpretation play, if any?

Without SSN, couldn’t get an account

Without job, how could I pay it back

Go to Community (family/friends) for money

Use a co-signer

DHHS Emergency Assistance (pay up to $250 if they have children)

3. What steps would you be willing to take to help ensure someone is successful in securing funding for housing? This might look like additional factors being considered, additional time with the client, or working with a third party- and more.

Volunteer Housing Coach

Word of mouth referrals for landlords

Rental workshop

Educational Outreach

Education on how to pay back the security deposit

Education on how to be a good tenant

Whole family approach

Family Development Coaches

Be a safe place to get information

Financial literacy


Feedback from Focus Group on Emergency Loans

Direct Experience

1. Given your past experiences when you were in crisis or facing an emergency:

a. What were examples of the emergency you were facing?

Car repairs

Sick family, death, funeral (flying a body home is rare but expensive) – back home sending money

Hospital – pay first, care later (meds)

Tuition for back home (high school pays tuition)

Apartment (security and first month)

Emergency bills (unexpected power)

Last minute expenses for wedding/event

Gap funding for vehicle purchase (need down payment)

Payment for interpreter

Cultural choice to borrow from family verses a bank (informal family system of saving for emergencies)

Language barriers

b. What is the amount of financial support that would have addressed your emergency?

$1,500-$2,000 ($10 per $500, $50 max)

$3,000+ for funeral expenses

$300-$500 for car repairs

2. When you need funds for an emergency, how long you do you have to secure the additional funds you need for them to be useful in the emergency?

2-5 days

Funerals – the longer you wait to pay after deposit, the more you pay

3. What were the challenges you faced in securing funds for your past emergencies?

Language barrier

Credit score

DTI

Interest

Transportation to bank or credit union

SSN/Documentation

Income proof

4. Misc

CCU members to have conversations on the needs of members/community

Pop-up feedback sessions

Providers

1. When assisting people with emergencies or people in crisis, what are the biggest factors that are considered? (Consider: size of emergency, number of people impacted, complexity of emergency, patterns of emergency, others?)

Sick Time (they may not get paid if they are missing work)

Life patterns (frequency, pay fluctuations, hours, economy-gas prices)

Car repairs ($100-$500)

Seasonal (heating oil, winter)

Decision making – not a should I or could I

Define emergency?

Medical/Dental emergencies

Cell phone is a “need”

Housing

Payday loans

2. What are the barriers to assisting or supporting them? (language, funds available, program restrictions, lack of reference, others?)

Funds

Language barriers

No support system

Not being connected to a financial institution

Embarrassed

Unfamiliar with financial system

Unfamiliar with resources (ie- 211)

Program restrictions (ie- General Assistance)

Interest Bearing product

Employers –strict attendance, termination

Time

Access

Citizenship

3. What has led to success? (interpreters, trusting relationships, service provider relationships. others?)

Support systems

Gifting/granting

Make it easy to understand

Quick turnaround

Weekend/evening access


Many are not connected with a financial institution

Some are too embarrassed to tell a “stranger” what they need

5. As we think about ways to partner with employers to support their employees needs, it is helpful to think together about the employers that are most often noted when working with folks in emergencies. What employers do you see individuals working at? (Low wage, manufacturing, specific sectors, others?)

Wal-Mart

Industrial Park bakery for Dunkin Donuts

Call Center (TD)

Dingley Press

Healthcare

Uber/Lyft

Housekeeping (Hilton, Ramada)

Commonwealth Poultry Company

6. Program Considerations

Loan/Savings Product (similar to Credit Builder but add a savings component)

Association Account (“rainy day fund”

State Bonding Program (Veteran’s, Criminal Background)

Secure credit cards

Overdraft protection

Child support “gap”

Work Ready program/component

Bridges out of Poverty

7. Misc

Consider involvement with Cash Coalition


Feedback from Focus Group on Reliable Auto Loans

Direct Experience

1. What - if anything- keeps people from seeking an auto loan through a financial institution? (Specifically a loan other than through onsite financing)

Interest Rate/Interest

Credit Score (don’t know what it is, lack of score, low score, payment because of credit)

Job Security (length of time, temp income, not being confident the job is something you believe you can stay with (not just a lender point of view))

Income/monthly payment advice

Lack of knowledge with banking

GA creating tension/priorities

Need for someone with knowledge to guide them

Literacy

Dealer taking advantage of lack of knowledge/literacy (auto condition, maintenance, interest rate)

Advertisement/scam pulls people to dealers (suggest inaccurate terms, false promises)

Seems dealer loans are faster to get approved for

Trust or distrust of financial institutions

Want low/no fees

Banks take advantage of urgency

2. For those of you who have looked for a car- how do you find a car? What does shopping for a car look like for you? Where do you go? Was translation made available to you?

Online shopping (Car Guru, year, mileage, CarFax, VIN, value)

Cash only

Private sale

Middle man/Advocate needed (financial literacy after loan closing)

Willing to: open account, direct deposit, auto pay, no maintenance fee

Payroll deduction

Direct deposit

3. For those of you who have tried to get a loan for a car, thought about getting a loan for a car (or are close to someone who has)- what were the challenges you faced or worried about? (this could be any barrier- from available translation, the type of auto, to accessing the loan process, to your financial readiness for a loan: ie. Debt to income ratio, credit score and more)

Length of time in America/address

Meant to feel like nothing if you have no credit

Banks/Credit Unions don’t trust you

Mistakes and miscommunication with basic transactions causes hesitation with borrowing

You are told not to try to understand because these things weren’t made for you

Are banks willing to lend to immigrants? (cross-sell, offering products)

Once trust is gone it’s hard to rebuild

Employer referral


Down payment

Education on car buying

Willing to take financial literacy class (before the loan)

Financial literacy for youth

Choices

5. Outreach

Account opening incentives

Member Service word of mouth

Existing membership for outreach

Work with GA

Bank Ambassador

Employee from the community

Incentives to take financial literacy class (rate discount) Providers

1. When assisting people with finding an automobile and/or financing- what are the biggest factors that cause the sale/loan to fall through? What are the factors that led to success?

No credit score, damaged credit

Employment

DTI not an issue

Understanding equity (group/families lend each other money)

Mistrust (need to build relationships)

Co-Signer (for under age 18 borrowers)

Chex Systems

Communication (Teach Back, Interpretation)

Cultural Brokers

No savings established

2. How often- if ever- do low-income people or new Americans work with a financial institution in the loan process? What trends or patterns do you see about the type or location of institutions? What role does translation or interpretation play, if any?

Using financial institutions (most have checking)

Word of mouth referral

“Who do you trust?”

CCI clientele sees Pay Day Lenders and Check Cashers

Fraud

Using Money Orders

Mistrust of banks, trust their family and circles

Multiple Accounts (debit card usage)

Whole Family Approach

Rainy Day Matching Savings

3. What steps would you be willing to take to help ensure a sale or loan is successful? This might look like additional factors being considered, additional time with the client, or working with a third party- and more.

Partnership programs

Commitment as consideration (ie- someone pays their landlord, take that into consideration)

Financial Literacy

Incentivize the learning

Pay It Forward loan

Mentor

Not “No”, instead “Not right now” Dealerships

1. When assisting people with finding an automobile and/or financing- what are the biggest factors

that cause the sale/loan to fall through? What are the factors that lead to success?

Evergreen Subaru o Negative Factors

Income (not enough or length of employment is short) No Money Down Unrealistic payment, or unable to make payment work Credit Score Unrealistic expectations

o Positive Factors Income Credit Score

Lake City o Negative Factors

Expectations on type/amount for vehicle Credit Score

o Positive Factors Credit Score

Crafts Auto o Negative Factors

Credit Unwillingness to wait / patience

o Positive Factors Pre-Approvals Money Down

2. How often- if ever- do low-income people or new Americans work with a financial institution in

the loan process? What trends or patterns do you see about the type or location of institutions?

What role does translation or interpretation play, if any?

Evergreen Subaru o Fairly often they have low income / tight income / new Americans o Subaru can be helpful but typically only if they are purchasing a Subaru o No particular struggles but process definitely takes longer o Translation could be helpful but usually when they are serious they come with a

younger or more English fluent relative/friend

Lake City o See new Americans often and income struggling individuals o cPort Credit Union has this group captivated. Known program amongst this group of

20% down, most are already working or banking with cPort o Key Bank used to have a no interest, fee based product but no longer see it o Translators would be helpful but there are so many languages it would be confusing;

most bring younger son/daughter to help with translations

Crafts Auto o Most new Americans already are working with cPort o They do see them often; especially from the Lewiston Area o Most that are serious come with someone who can translate or know both

languages enough to get through

3. What steps would you be willing to take to help ensure a sale or loan is successful? This might

look like additional factors being considered, additional time with the client, or working with a

third party- and more.

Evergreen Subaru o Time o Looking for a vehicle; potentially going to auction

Lake City o Time o Auction shopping o Shortening their profits on a deal o Delivering vehicles to customers o Educating the buyer rather than straight denying

Crafts Auto o Auction shopping o Taking the time to educate the buyer o Helping the buyer understand their own situation o Time

Information to Get from Stakeholders: Reliable Auto Loan

FOR THOSE WITH DIRECT EXPERIENCE-

1. What - if anything- keeps people from seeking an auto loan through a financial institution? (Specifically a loan other than through onsite financing)

2. For those of you who have looked for a car- how do you find a car? What does shopping for a car look like for you? Where do you go? Was translation made available to you?

3. For those of you who have tried to get a loan for a car, thought about getting a loan for a car (or are close to someone who has)- what were the challenges you faced or worried about? (this could be any barrier- from available translation, the type of auto, to accessing the loan process, to your financial readiness for a loan: ie. Debt to income ratio, credit score and more)


FOR THOSE WHO PROVIDE LOANS OR AUTOMOBILES -

1. When assisting people with finding an automobile and/or financing- what are the biggest factors that cause the sale/loan to fall through? What are the factors that led to success?

2. How often- if ever- do low-income people or new Americans work with a financial institution in the loan process? What trends or patterns do you see about the type or location of institutions? What role does translation or interpretation play, if any?

3. What steps would you be willing to take to help ensure a sale or loan is successful? This might look like additional factors being considered, additional time with the client, or working with a third party- and more.

Questions on a short form for each participant to complete privately and anonymously:

1. How long have you been at your current address? 2. In the last 3 years, what is the longest amount of time you have stayed at one address? The shortest amount of

time at one address? 3. How long have you been at your current job, if you are employed? 4. In the last 5 years, what is the longest amount of time you have stayed at one job? What is the shortest? 5. Do you know what a credit report is? If so- have you ever seen your credit report? 6. Have you had an auto loan before? When was the last time? 7. Do you deposit, save, and spend money from an account with a financial institution? 8. Do you ever utilize a payday loan center? 9. When looking for an automobile, what are the main things you consider? (Price, size, year, miles, cost and more)

Information to Get from Stakeholders: Emergency Loan


1. What - if anything- keeps people from seeking a personal loan through a financial institution?

2. Given your past experiences when you were in crisis or facing an emergency, what were examples of the emergency you were facing?

3. What is the amount of financial support that would have addressed your emergency?

4. When you need funds for an emergency, how long you do you have to secure the additional funds you need for them to be useful in the emergency?

5. What were the challenges you faced in securing funds for your past emergencies?


FOR THOSE WHO PROVIDE SUPPORT TO PEOPLE IN CRISIS

1. When assisting people with emergencies or people in crisis, what are the biggest factors that are considered? What are the barriers to assisting or supporting them? What has led to success?

2. How often- if ever- do low-income people or new Americans work with a financial institution in securing funds?

What trends or patterns do you see about the type or location of institutions? What role does translation or interpretation play, if any?

3. What steps would you be willing to take to help ensure someone is successful in securing funding for emergencies? This might look like additional factors being considered, additional time with the client, or working with a third party- and more.

Questions on a short form for each participant to complete privately and anonymously: 1. How long have you been at your current address? 2. In the last 3 years, what is the longest amount of time you have stayed at one address? The shortest amount of time

at one address? 3. How long have you been at your current job, if you are employed? 4. In the last 5 years, what is the longest amount of time you have stayed at one job? What is the shortest? 5. Do you know what a credit report is? If so- have you ever seen your credit report? 6. Have you had a loan before? When was the last time? 7. Do you deposit, save, and spend money from an account with a financial institution? 8. Do you ever utilize a payday loan center? 9. In the last 3 years, what were some of the biggest emergencies you faced? 10. In those emergencies, what amount of funds would have helped you get through the emergency?

Information to Get from Stakeholders: Rental Security Deposits


1. What - if anything- keeps people from seeking a personal loan through a financial institution? 2. What is the amount and of financial support that is often needed to establish new housing, and the types of

support needed? (Deposit, first, last, utilities, moving costs…) 3. When you need funds for securing new housing, how long you do you have to secure the additional funds you

need? 4. What are the challenges you have faced in securing funds for new housing? 5. What steps would you be willing to take if it strengthened your ability to get a loan? Examples include completing

a financial literacy class, establishing an account and relationship at a financial institution, providing additional information about regular payments to your landlord, electric, or cable/internet payments.

FOR THOSE WHO PROVIDE SUPPORT SECURING HOUSING-

1. When assisting people with securing housing, what are the biggest factors that are considered? What are the barriers to securing housing? What has led to success?


3. What steps would you be willing to take to help ensure someone is successful in securing funding for housing? This might look like additional factors being considered, additional time with the client, or working with a third party- and more.

Questions on a short form for each participant to complete privately and anonymously:

1. How long have you been at your current address? 2. In the last 3 years, what is the longest amount of time you have stayed at one address? The shortest amount of

time at one address? 3. How long have you been at your current job, if you are employed? 4. In the last 5 years, what is the longest amount of time you have stayed at one job? What is the shortest? 5. Do you know what a credit report is? If so- have you ever seen your credit report? 6. Have you had a loan before? When was the last time? 7. Do you deposit, save, and spend money from an account with a financial institution? 8. Do you ever utilize a payday loan center? 9. When looking for housing, what are the main things you consider? (Price, size, year, miles, cost and more)

Partnership Guiding Questions

Purpose

Guiding Question: What is the common purpose that will guide us? *Explore together at initial discussion*

What is our purpose for this partnership- what do you hope stems from partnering together? What assumptions do we have about other potential partner’s purpose for partnering?

Common Understanding

Guiding Question: How will we reach a shared understanding of our values, culture and approach to our partnership? *Explore together at first follow-up discussion*

What do we think is important to understand about each other’s values, culture, and approach? What do we want to learn about each other’s values, culture and approach? *Explore prior to initial partnership discussion*

Communication

Guiding Questions: How will we effectively communicate? Where are our feedback loops? *Explore together at initial discussion, define at first follow-up discussion*

What is our preferred form of communication- and what other forms are we willing and able to utilize? What is the frequency of communication that is ideal? *Explore prior to initial partnership discussion*

Culture and Values

Guiding Question: How do we create common values that recognize all cultures and support meaningful involvement? *Explore together at following discussion*

As we explore this partnership, how and when will we create common values? How will we ensure our method and timing recognizes all cultures and supports meaningful engagement? *Explore prior to initial partnership discussion*

Leadership

Guiding Question: How will the partnership be led? *Explore together at following discussion*

How would we like the partnership to be led? What leadership role, if any, will each of us have? *Explore in preparation for discussion*

Learning and Development

Guiding Question: How will ensure ongoing learning and development at all levels of the partnership-the partnership, the individual organizations, and the people within the organizations? *Explore together at following discussion*

How will we transfer learning from the partnership throughout our respective staff and boards? How will we support development of each other and our staff? *Explore in preparation for discussion*

Performance Management

Guiding Question: How will we demonstrate accountability for our actions, and ownership of outcomes? *Explore together at following discussion*

What can we expect from each other- what outcomes do we “own”? individually or collectively? How can our partners hold each other accountable? *Explore in preparation for discussion*

Programs for Economic Security – Emergency Loans


New Mainers



Borrowers with no credit history This program will take shape in three different products:

Secured Credit Card

Emergency/Savings Loans

Employer-Sponsored Small Dollar Loans Secured/Unsecured Credit Card The Credit Union already offers a credit card program. To make the program more attractive for building credit we will lower our minimum credit line from $750 to $250. Emergency/Savings Loan The Emergency/Savings loan will combine a credit builder loan with an unsecured loan for emergency purposes. The Credit Union will fund 100% of the loan; 50% will be provided for the stated emergency and the other 50% will be locked in a savings account to secure the loan and begin a savings account. Criteria The below criteria will be used to determine is someone qualifies for this program. Details of each criteria indicate the Credit Union’s preference for the specific criteria. If they do not meet those details, the loan may be denied.

Criteria



Length of Employment 9 months, will consider

temp if it has been

continuous



been continuous

Minimum 2 years


no derogatory after

discharge


no derogatory after

discharge


no derogatory after

discharge

Repo/Foreclosure No more than 1 of each in the last 3 years

No more than 1 of each in the last 3 years

No more than 1 of each

in the last 3 years



be in repayment


be in repayment


be in repayment



in last 12 months

(excluding medical)



in last 12 months

(excluding medical)



in last 12 months

(excluding medical)

Stipulations

When being approved for this program, the following stipulations will be made with the loan. These stipulations are in place to ensure protection for the member and to ensure protection and mitigate risk for the Credit Union.

Stipulations





Minimum Rent Applied to DTI $400, unless proof of

lower amount

$400, unless proof of

lower amount

$400, unless proof of

lower amount



applicant

Minimum of 3 per

applicant

Minimum of 3 per

applicant

Additional Considerations



Employer-Sponsored Small Dollar Loan The Employer-Sponsored Small Dollar Loan is designed to be an emergency loan product that removes barriers and judgment. The Credit Union will initially select a limited number of businesses to partner with. The program requires that the Credit Union to work closely with the HR Departments of businesses. Employees go to their HR Department when they have an emergency that they need a loan for. HR assists them with completing an application and provided the employee meets the criteria they will automatically be granted the loan. The loan requires auto pay from the employee’s payroll and also requires the employee to agree for the Credit Union to be notified of changes in employment. The program also provides opportunities for the Credit Union to provide financial literacy to the employees and open accounts on site. Criteria

The below criteria will be used to determine is someone qualifies for this program. Details of each criteria indicate the Credit Union’s preference for the specific criteria. If they do not meet those details, the loan may be denied.

Criteria

Maximum Debt-to-Income 50%

Length of Employment 6 months

Length in File 0 months

Stipulations


Stipulations

Minimum Loan Amount $250

Maximum Loan Amount $2,000

Term 90 days to 12 months

Minimum Rent Applied to DTI $400

Payment Auto deduction from payroll required. Once loan has been paid in full, auto

deduction will continue to establish a savings account (savings transfer may

be cancelled once loan is paid in full).

Income Requirement Stated income in application, verified with HR

Number of Loans No more than 1 ESSDL at a time, no more than 3 a year

References Minimum of 2 per applicant, 1 may be from employer

Additional Considerations

Financial Literacy should be incorporated into these programs by providing on-going financial literacy in the business.


Time in file

Credit score

Payment history


Inquiries

Types of loans



Job/Income:


Salary


Stability

Future pay increase

Total debt ratio


Disposable income


How long a member



Payroll deduction



Family connections





Payment to income
















Negative Credit:







FICO scores < 620:









Employment:

Less than 6 months employment: o Definitely a cautionary flag – but what was the borrower’s previous employment

history? o Is this job better than the previous one with more income or opportunity? o Was the person laid off from a previous job? Does this appear to be a temporary job





statement may not be reasonable for many people new to self-employment.

o Does the person have a business account and can he/she provide a record of business deposits, expenses, or reference letters from clients? Is there a website, etc.?

o A self-employed borrower with a credit score under 620 is a very different risk than a self-employed borrower with A or B credit. Can the loan be strengthened in some other way?

Programs for Economic Security – Rental Security Deposits


New Mainers



Borrowers with no credit history Guidelines for Rental Security Deposit Loan Program (would like to come up with a name to better brand it): Criteria The below criteria will be used to determine is someone qualifies for this program. Details of each criteria indicate the Credit Union’s preference for the specific criteria. If they do not meet those details, the loan may be denied.

Criteria



Length of Employment 9 months, will consider

temp if it has been

continuous



been continuous

Minimum 2 years


no derogatory after

discharge


no derogatory after

discharge


no derogatory after

discharge

Repo/Foreclosure No more than 1 of each in the last 3 years

No more than 1 of each in the last 3 years

No more than 1 of each

in the last 3 years



be in repayment


be in repayment


be in repayment



in last 12 months

(excluding medical)



in last 12 months

(excluding medical)



in last 12 months

(excluding medical)

Stipulations


Stipulations





Minimum Rent Applied to DTI Copy of rental

agreement for proof of

monthly pmt and

security deposit

Copy of rental

agreement for proof of

monthly pmt and

security deposit

Copy of rental

agreement for proof

of monthly pmt and

security deposit



applicant

Minimum of 3 per

applicant

Minimum of 3 per

applicant

All loan proceeds will be made payable to the landlord, no exceptions. Pre-approval letter will be provided as proof to landlord that the loan has been approved and they will receive payment for the security deposit. Additional Considerations



We would be willing to offer a 2% rate discount for those who qualify for this program and complete, prior to the loan, a complete financial literacy program (consider a partnership with ProsperityME to use their class for this purpose, consider a joint-grant opportunity with ProsperityME to hire someone for this capacity). A floor rate of 3.00% would apply.

We would be willing to offer a 1% rate discount for those who do not qualify for this program but complete, prior to the loan, a complete financial literacy program (consider a partnership with ProsperityME to use their class for this purpose, consider a joint-grant opportunity with ProsperityME to hire someone for this capacity). A floor rate of 3.00% would apply.


Time in file Credit score

Payment history


Inquiries

Types of loans



Job/Income:


Salary


Stability

Future pay increase

Total debt ratio


Disposable income


How long a member



Payroll deduction



Family connections





Payment to income
















Negative Credit:







FICO scores < 620:









Employment:

Less than 6 months employment:

o Definitely a cautionary flag – but what was the borrower’s previous employment history?

o Is this job better than the previous one with more income or opportunity? o Was the person laid off from a previous job? Does this appear to be a temporary job





statement may not be reasonable for many people new to self-employment. o Does the person have a business account and can he/she provide a record of business

deposits, expenses, or reference letters from clients? Is there a website, etc.? o A self-employed borrower with a credit score under 620 is a very different risk than a

self-employed borrower with A or B credit. Can the loan be strengthened in some other way?

Documents

Fatuma Hussein Bright Lukasa Heidi McCarthy...Review our shared goals, timeline and process Share the expectations and seek commitments Planning team expands- new/all partners meet