By Ray Birch
MADISON, Wis.—It’s time credit unions occasionally shut down their branches for an hour and take staff into their communities—including riding the bus—to understand the real-life issues their underserved members are facing.
That was among the key points Donovan Duncan made during a recent Filene Research Institute webinar on housing insecurity, during which he urged credit unions to better understand their low-income members who are struggling with finding a place to live.
He emphasized when people face housing insecurity, it is difficult for them to get much else right in their lives.
“I firmly believe, and I think my team believes, that housing is at the epicenter of everything,” said Duncan, EVP for Urban Strategies Inc., a St. Louis-based nonprofit that implements place-based human capital development strategies. “If someone is not stable in the house, it's hard for them to go to work. It's hard for them to educate their children. It's hard for them just to do the basic things that are rudimentary. It's at the epicenter—housing is the most succinct thing that connects us all to quality of life.”
What the Data Show
Robin Brulé, senior director of philanthropic partnerships at Filene, pointed to data that demonstrate the degree of the problem.
“Housing affordability, as we know in America, has been declining for years, and the social and economic impact of the pandemic has exacerbated this problem,” said Brulé. “A recent study by Pew Research found that 85% of respondents are concerned about the availability of affordable housing, with 49% considering it a major concern.”
She said that among younger Americans and those living in urban areas, the concern is even higher.
“The affordable housing crisis is not just about individuals living beneath the poverty line, although, of course, that is a great concern, as well,” Brulé said. “A significant amount of middle-income individuals and families are having a very hard time with homeownership, as well as quality rental apartments that are out of reach for them.”
Disparities in Debt
Brulé pointed to a recent report by the Aspen Institute that examined disparities in debt.
“They really highlighted homeownership as an asset-building strategy, which is very important,” she said, adding that conversation also includes debt. “Why and how people are having the kinds of debt problems that are having and what that means for racial wealth gaps, and the ability to build assets. We know economic inequity has long persisted in the U.S., and that the wealth gaps, racial wealth gaps, continue today. There's an uneven landscape, and there's a long history of disparities and rules and regulations that kept certain populations and individuals from owning homes.”
Brulé further noted the different impacts on debt in households of color.
“Credit reporting is also a major issue,” Brulé said. “Black and Latino households tend to have lower credit scores, which again translates to lower rates of homeownership, or greater exposure to different kinds of fees or higher costs. Black, Latino and Native American homeowners are much more likely to be offered high-cost mortgages, and typically hold less equity than their white counterparts. And this too, is a major challenge.”
Get Out of the Office
To really be able to help the underserved, and address housing insecurity, Duncan told credit unions they have to get out into their communities more often.
“I’ll tell you how we do it. Every time we enter a new market where we have an office, I literally walk the neighborhood. I walk the community. I go to the corner store, visit the restaurants and patronize other retail establishments. I just start asking questions about why people love working there, fellowshipping there, living there…’ Duncan said. “If you come to that conversation in a very learning and authentic way, people will gravitate towards that and share. So, if you have branches in communities, I would say close down your offices, maybe at lunch. Take people out and visit the neighborhood and just ask questions. And when people feel there's a relationship there, they will come. They will share. They will partner with you. And they will be an ally to really supporting the systemic change that you want to see happen.”
‘Legitimate and Robust’
Duncan said he believes it is impossible for the credit union to make these kinds of strides and help the underserved with housing issues if their efforts are not done in a “legitimate and robust way.”
“You can’t do this from your office,” he said. “Me and my team, we will ride the bus to the employment hub to see how long it takes. Then we try to figure out if a family has two children and school starts at eight o'clock and they have to be at work at eight o'clock, what kind of challenge is it for them just to get where they need to go. If they're taking public transportation, then we try to solve for that.
“We're talking about pervasive problems. But we're also talking about human beings who every single day have to make real-time decisions on how to support their families. And when you're partnering with that, on that level, you can design solutions that benefit all.”