Judith is a first generation American who started her own cleaning business two years ago. She had no credit, but needed a car to get from house to house, so she went to predatory auto lender– a “buy here, pay here” dealer, and ended up with an APR of 21.58% and monthly payments of $568. She grossed $3,800/month in her business. Twenty six months of on-time payments later, she still owed $16,000 on the loan, but her vehicle was only worth $12,000. Even though her credit score had climbed into the high 600’s as a result of her on-time payments, she couldn’t find a financial institution to refinance her to a lower rate.
Judith met with one of our financial counselors who thought she would be perfect to be our first test case with our Loan Guarantee Fund. This fund is held by Sound Outreach at Harborstone Credit Union to help reduce the risk of defaults when they lend to our clients.
Because we knew Judith made vehicle payments on time at $568/month for more than 12 months, and because we guaranteed half of any potential default, Harborstone refinanced her auto loan to below 5%, bringing her payments to $377/month, which saves her $191 monthly, and a total of $6,500 in interest over the next 48 months of payments. We have high hopes for Judith’s success and for our continued partnership with Harborstone Credit Union!
The Little Family Foundation believes so strongly in the ability of our new Credit Up Loan Guarantee Fund to have a real, measurable and direct impact on the cycle of poverty that they have offered to match all new donations in order to significantly grow our fund and to support our Financial Counseling program!
For every dollar donated, half will go toward our CreditUp Financial Counseling Program, and half will be matched up to $10,000 and placed in our Loan Guarantee Fund. Reaching our $20,000 goal would mean that Harborstone Could loan up to $400,000 to our clients in order to help them end the cycle of poverty!
Jeff Klein sits down with Katy Davis from Ideas42 to talk about the impact of a scarcity mindset on behavior. Subscribe to the Credit Up podcast from your Podcasts app or click on this link.
Sound Outreach’s Board Chair Amy Remington and Deputy Director Alanna Rodgers sit down to talk all things housing and financial empowerment. They talk about the impact Credit Up can have in our community, the relationship between the housing market and financial empowerment, what is happening with the local housing market we may not be aware of, and where we seem to be headed. Download the episode on your Podcasts app or click on this link, and thanks for listening.
Victoria Woodards is our latest guest for the podcast. She sits down with Jeff Klein to talk about financial empowerment in Tacoma, equity, and the Urban League’s African American Financial Capability initiative.
Click on the photo or, better yet, subscribe to the Credit Up podcast on iTunes. Thanks for listening!
Tim Jumper, Director of Sound Outreach’s Center for Strong Families, sits down with Jerae Ray to hear his story about overcoming his criminal background to get a high-wage job, and how he used the first Credit Up emergency loan to get trained as an iron worker apprentice.
Use the link below to listen, or subscribe to the Credit Up podcast on iTunes!
The Credit UP Podcast Series is derived from Sound Outreach’s Financial Empowerment Program initiative of the same name. From non-profit leaders to first- time borrowers, the hosts have authentic conversations with community residents about financial opportunities and obstacles in Tacoma, Washington. For the first three podcasts in the series, click on the the link below.
Charles Taylor has a clear vision for his success. He has an ambitious spirit and is not slowed down by obstacles. Overcoming the problems that might discourage others is part of what makes him an entrepreneur. Charles recently started a small but profitable business. He has built a network of contacts and has plans for expansion. What he doesn’t have is good credit–an obstacle that’s difficult to overcome with grit alone.
On November 10th, Charles received the first Credit-Builder Loan through “Credit Up,” Sound Outreach’s financial counseling and loan program done in partnership with Harborstone Credit Union. With long-term financial coaching and access to low-cost financial products, Credit Up helps Pierce County residents take control of their finances.
The Credit Builder Loan is a no-fee, $300 loan with a low 3.1% interest rate. The sole purpose of the loan is to build or repair credit by saving the loan money for a period of time rather than spending it. The $300 loan is deposited in a restricted savings account. After it’s repaid, the funds are released to the borrower who, through positive repayment, has improved their credit score. The Credit-Builder is one of five products offered through Credit Up.
In addition to the loan, Charles is meeting with one of the program’s certified financial coaches to develop and implement his financial plan, which includes opening a checking account at a traditional bank or credit union. After building his credit, he will apply for a small business loan.
Charles’ story shows why this free program is unique and effective: the program combines financial counseling with access to products that are tailored to unlock peoples’ potential. Loans and other financial products are available to participants recommended by one of the financial coaches.
In the coming months, we’ll share more stories about our dynamic partnership with Harborstone as we team up to prepare Pierce County residents, especially those who are unbanked and underbanked, to overcome obstacles to reach their financial goals.
Questions? Interested in meeting with a financial coach or investigating financial products?
Contact Brian Humphreys
Have you ever faced a situation that seemed insurmountable? We helped a family this month at Sound Outreach who had challenges that seemed so overwhelming when they arrived, but by the time they left, they felt compelled to call to thank us for the $3,000 we saved them.
Dan is 56, disabled and on Medicare. Carla, his wife is 34 and is also disabled. Carla had no insurance and hadn’t been able to see a doctor for over two years for her mental health issues. When she married Dan two years ago, she lost her SSI because his disability benefits put them just over the income limit for her to qualify for supplemental income through Social Security.
They came to Sound Outreach looking for Health Insurance for Carla.They left with Washington Apple Health (Medicaid) coverage for Carla which allowed her to get an appointment with a mental health counselor.
We helped them to apply for food benefits and they qualified for $159 per month beginning immediately. We applied for the Medical Savings Program, saving the husband his Medicare Premium payment of $104.90 that was being taken out of his $1,455 check each month.
Visiting our office netted them an additional $263 per month and helped them to gain access to essential medical services for both of them.
We also applied for Extra Help, a federal program that assists with prescription drug coverage, Dan, who is disabled with lung disease, had not been able to afford the medication he needed. Now, he will be able to qualify for insurance that will cover his drug costs and cap his co-pays when he fills his prescriptions at a low cost. We are still working with Dan to find him a no-premium supplemental plan to cover some of the costs Medicare does not cover, but we hope to be able to navigate him through that process providing some peace of mind and some extra money to go towards savings.
Finally, Dan and Carla qualified for utility assistance through the WARM Fund from The Greater Tacoma Community Foundation, which paid $200 toward their electricity bill.
These sorts of things make you feel good about getting up each day to fight the good fight, and we can’t do this kind of work without your support. Thank you.
Last month, a young married couple met with Patty, our Rapid Rehousing Case Manager. The husband had a part-time job delivering pizzas. The wife was pregnant. They were homeless and could not find an apartment because of past evictions. Patty connected them with Workforce Central so the husband could receive training in their truck driving program, and she signed them up for SNAP Benefits. On the day they left the hospital, their baby had a warm home to return to thanks to Patty and the Rapid Rehousing Program. This fall, in Lakewood and Tacoma, more than 60 providers and hundreds of volunteers served more than 2,400 people at Project Homeless Connect. More than 900 people received over $1,000,000 in tax refunds. Thousands received food stamps, health insurance, and Medicare advice.