Microfinance Practice: Re: [MFP] RE: The Equal Credit Opportunity Act / USA

Anuj,

Just to add to what Bill mentioned about New Bedford, in Lowell we were unable to introduce Working Capital to the large Cambodian population because they were using the savings and lending and mutual support traditions they brought with them. How can these support mechanisms be strengthened and expanded in the communities where they are already functioning and can they be introduced to communities where these traditions do not exist or exist in a very rudimentary form? What can we learn from promoting Savings Groups in Africa and Latin America to bring to this country? Bill and I working through the University of New Hampshire's Carsey Institute aim to find out. Those who are part of these groups have a better chance of moving up the economic ladder in a generation not because they receive help from outsiders but by taking care of their own.

Jeff

Jeffrey Ashe
jaashe@aol.com

-----Original Message-----
From: wmaddocks <wmaddocks@gmail.com>
To: MicrofinancePractice <MicrofinancePractice@yahoogroups.com>
Sent: Tue, Feb 18, 2014 9:55 am
Subject: [MFP] RE: The Equal Credit Opportunity Act / USA

Hi Anuj,
While the mortgage default issue has now shifted to the "jumbo loan" end of the market its because many of the lower income people who got mortgages prior to 2009 have already defaulted. As we know the subprime mortgage debacle had the disastrous effect of making too much credit available to too many people and often in the same neighborhoods that had been previously red lined. According to a report on NPR last May more than half the wealth in Black and Latino communities was erased by the banking crisis which has left millions underwater with mortgages bigger than their houses are worth and little to no relief from the banks or the federal government. I always disagreed with the "credit as a human right" concept. Why should being in debt be anyone's sacred right?

Its ironic that in Latino and other immigrant communities informal savings-based arrangements made it possible for many to buy houses when prices were not so inflated and employment was more prevalent. I worked in a predominantly Portuguese immigrant community for two decades and saw "saving up" and pooled savings among family members the primary source of credit since the banks were not interested in extending credit to immigrants.Back in the 90's Jeff Ashe and I tried to bring the Working Capital peer lending concept to New Bedford's Portuguese fisherman they weren't interested because they already had access to credit from community funds family members had assiduously saved.
I be curious to know how many minority and immigrant communities in the U.S. are still using savings-based financial tools in this post-banking crisis era?

Bill

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