Hispanic Resource Center

News Updates...

(updated January, 2008)

Minorities hit hardest in subprime market

The subprime mortgage crisis will cost blacks and Hispanics up to $256 billion, says a study from United for a Fair Economy, a Boston nonprofit awareness group.

Hispanics could lose from $75 billion to $129 billion, the study claims. According to the study, which cited government mortgage data, nearly 33% of Hispanics who bought homes in Boston or five other major cities in recent years had high-priced mortgage loans.

In fact, 41% of blacks had high priced mortgage loans, compared with 7% of whites, the study said.

According to the study, affluent buyers were not spared problems with subprime mortgages: 54% of blacks, 49% of Hispanics, and 16% of upper income whites took out high-cost loans. The study “Foreclosed: The State of the Dream 2008” calls the current mortgage crisis the “greatest loss of wealth for communities and individuals of color in modern U.S. history.”

Citizens hope to launch Latino CU in Georgia

Following a model similar to the Latino Community Credit Union in Durham, N.C., organizers in Georgia are hoping to launch a credit union specifically targeting Latinos.

Georgia Family Credit Union is the proposed name of the credit union and organizers are hoping to get the green light from regulators to begin operations later this year. The Latino community in Atlanta has reached the size where it can support a credit union offering a bilingual and bicultural staff, according to Paola Diaz-Torres.

Diaz-Torres and her supporters reportedly have $700,000 in seed money but need more seed money from community supporters. Organizers are focusing on a market of low-income, Latinos and other multicultural populations in the area, hoping to sign up 1,500 members over the initial three-year period.

The new credit union plans to compete with payday lenders and check-cashing outlets, reports the Atlanta Journal Constitution. To do so, it will focus on educating Hispanics about opening checking accounts, establishing credit, and budgeting.

WOCCU launches CUROP pilot program

Consumers sent more than $267 billion money transfers in 2006. And remittances to Latin American and the Caribbean alone accounted for $61 billion, nearly one-quarter of the transfers.

As a result of that market potential, the World Council of Credit Unions (WOCCU) has launched the Credit Union Remittance Outreach Program (CUROP).

CUROP is designed to encourage U.S. credit unions to reach out to underserved populations by offering international remittances. CUROP offers participating credit unions the standard VIGO product through WOCCU’s International Remittance program as well as extensive technical assistance to help improve membership growth and deposit growth potential. The program will focus on remittance-sending individuals.

The program builds on WOCCU’s International Partnership Program and the existing partnership between the Iowa Credit Union League (ICUL) and the Corporación Fondo de Estabilización y Garantía de Cooperativas de Ahorro y Crédito de Panamá (COFEP, WOCCU’s member in Panama) and will be implemented with the ICUL’s subsidiary, Coopera Consulting.

The pilot program will help participating credit unions build Hispanic membership by offering international remittances and other services. For example, CUROP will provide the pilot credit unions with help in marketing, community outreach, staff training, and financial education. The three pilot program credit unions represent these three asset categories: $1-25 million, $25-100 million, and $100 million and above.

For more information, contact Megan Webster, mwebster@woccu.org; 608-395-2073

CU executive launches Hispanic business development group

A credit union vice president is heading up the public launch of an organization designed to bring more Hispanics into leadership roles in California.

A substantial Hispanic community exists, but does not have a voice in regional business affairs, said Maurice Calderon, vice president for minority development at the $1.1 billion asset, San Bernardino-based Arrowhead Credit Union.

The Empire Hispanic Leadership Council began meeting in May and is ready to begin operations to influence discussions of economic, education, health, and transportation issues and to help mold policy (The Press Enterprise Jan. 16).

The council—having already helped organize business expos and workshops—also will develop and maintain a database of Latino-owned businesses in the region.

San Bernardino and Riverside counties have a 44% Hispanic population, according to 2006 U.S. Census estimates—up from 38% in 2000. Despite being a significant segment of the population, few Latino's are part of influential business and civic groups, Calderon said.

The problem has been that leaders of business and civic groups tend to select people who most look like them, Calderon said, adding that not enough Latinos have attempted to get involved.

Latino Community CU launches online service

Latino DirectNet, a new online service provided by Latino Community CU, was introduced to members Tuesday.

Latino DirectNet allows members to access most of the $50.8 million asset, Durham-based credit union's products and services.

"With this service, available in English and Spanish, members will be able to manage their accounts and carry out many types of transactions from home," said Angel Romero, Latino Community marketing director. "Members will no longer need to go to branches, use the phone, or go to an ATM. They will be able to do it all from their computers—from any place that has an Internet connection."

Transactions at Latino DirectNet are protected by physical, electronic, and procedural measures, the credit union said.

A highlight of the new bilingual system is the possibility of making investments online. "For example, members will be able to open share term certificates to enjoy Latino Community's dividend rates," Romero explained. "Another feature of Latino DirectNet is that it allows users to transfer money between accounts. Users can pay credit cards and loans as well.

"Also, members will be able to pay utility bills and other services with BillPay. Through the BillPay system, credit union members will be able to schedule one-time or recurrent payments," he added.

A glimpse at U.S. incomes by race and ethnicity

Short takes

• With nearly 25% of the San Francisco bay area’s population being Hispanic, it’s no wonder Patelco CU is running an eight-week marketing blitz—using radio, point of sale, collateral, and events marketing efforts--to tap the area’s Hispanic population. The $4 billion credit union is promoting membership and its new remittance program that has no fees provided the user is a Patelco member with a savings or checking account (CU Journal, Dec. 3) …
• The Dallas-Fort Worth chapter of the Financial Planning Association has received a $40,000 grant from the Certified Financial Planner Board of Standards to produce a financial literacy DVD for Hispanics that will be distributed at major Latino functions, locations, or groups. The free DVD, which will be in Spanish and English, also will be featured on public radio and television. (The Dallas Morning News) …
• The remittance market still is dominated by money transfer companies such as Western Union, but credit unions and banks have entered the market and the growing competition has lowered money transfer fees substantially. Such fees still average almost 6%--about $11 on a $200 transfer. Credit unions and banks still only handle about 10% of transfers says SFGate.com …
• The Pew Research’s “2007 National Survey of Latinos: As Illegal Immigration Issue Heats Up, Hispanics Feel a Chill,” report says more Hispanics are worried about immigration reform. While the political environment is a growing concern for Hispanics, Wall Street is embracing the market as a growing economic force that businesses, advertisers, and investors should embrace. That’s the view from Goldman Sachs which has updated its 2004 report on “U.S. ‘Hispanization’” and suggests that half the nation’s population growth between now and 2010 will be Latinos. Overall, Hispanics will represent 20% of the population by 2030. The study suggests this market spends less than non-Latinos on insurance, pensions, entertainment, and health care …
• Latino Community Credit Union, Durham, N.C., is branching out—this time with additional branch offices in Charlotte and Wake County. The $55 million asset credit union has 51,000 members. The credit union recently received a grant of $500,000 and a $5 million low-interest-rate investment loan that it will use to provide loans to low-income households …
• Bucking the trend in many other wealthy industrialized nations, the United States seems to be experiencing a baby boomlet, reporting the largest number of children born in 45 years. The nearly 4.3 million births in 2006 were mostly due to a bigger population, especially a growing number of Hispanics. That group accounted for nearly one-quarter of all U.S. births. But non-Hispanic white women and other racial and ethnic groups were having more babies, too. There are cultural reasons as well. Hispanics as a group have higher fertility rates--about 40% higher than the U.S. overall …

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