Month: September 2016

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Today, the MacArthur Foundation announced this year’s class of MacArthur Fellows. Among the short list of esteemed awardees is José Quiñonez, Founder and Chief Executive Officer of Mission Asset Fund (MAF). The announcement has been covered by news outlets including the New York Times, the Washington Post, and The LA Times.

The MacArthur Fellowship, often referred to as a “genius grant,” recognizes those with exceptional creativity, a track record of achievement, and the potential for significant contributions in the future. Each fellow receives a no-strings-attached stipend of $625,000 to support awardees’ pursuit of their creative visions. Since 1981, fewer than 1,000 people have been named MacArthur Fellows. Fellows are selected through a rigorous process that has involved thousands of expert and anonymous nominators, evaluators, and selectors over the years. Past fellows have included notable individuals like Henry Louis Gates, Jr., Alison Bechdel, and Ta-Nehisi Coates.

“This award is a high honor that recognizes the ingenuity of people who live in the shadows, who come together to help one another to survive and thrive in life. The award lifts up what is right and good in people’s lives – the trust and commitment they have for one another,” says Quiñonez.

According to the Foundation:

José A. Quiñonez is a financial services innovator creating a pathway to mainstream financial services and non-predatory credit for individuals with limited or no financial access. A disproportionate number of minority, immigrant, and low-income households are invisible to banks and credit institutions, meaning they have no checking or savings accounts (unbanked), make frequent use of nonbank financial services (underbanked), or lack a credit report with a nationwide credit-reporting agency. Without bank accounts or a credit history, it is nearly impossible to obtain safe loans for automobiles, homes, and businesses or to rent an apartment.

Quiñonez is helping individuals overcome these challenges by linking rotating credit associations or lending circles, a traditional cultural practice from Latin America, Asia, and Africa, to the formal financial sector. Lending circles are typically informal arrangements of individuals pooling their resources and distributing loans to one another. Through the Mission Asset Fund (MAF), Quiñonez has created a mechanism for reporting individuals’ repayment of small, zero-interest loans to credit bureaus and other financial institutions. MAF participants are able to establish a credit history and gain access to credit cards, bank loans, and other services, and lending circles focused on youth provide individuals with fees for Deferred Action for Childhood Arrival applications and apartment security deposits (which are particularly needed by youth aging out of foster care). All participants are required to complete a financial training class and are provided with financial coaching and peer support. Since the lending circles were established in 2008, participants’ credit scores, collectively, have increased an average of 168 points.

Quiñonez has established a network of partnerships with the financial services industry to enable other organizations to replicate his approach. With Quiñonez and MAF providing the technology necessary to disperse and track loans (a significant hurdle for many nonprofits) and assisting in securing local partners and investors, 53 nonprofit providers in 17 states and the District of Columbia are now using this powerful model in their communities. Quiñonez’s visionary leadership is providing low-income and minority families with the means to secure safe credit, participate more fully in the American economy, and obtain financial security.

Felicidades, José!

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Sonia: A Future Chicago Homeowner

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Sonia arrived in Chicago from Puerto Rico one year ago with hopes to turn over a new leaf. As a result of a difficult divorce, her credit report was dotted with blemishes.

A low credit score and considerable debt were keeping Sonia from accessing affordable loan options and achieving an important personal goal: purchasing a home.

In her search for a solution, Sonia discovered my organization, The Resurrection Project (TRP), in a local newspaper.  She learned that TRP provided Lending Circles and became interested in this opportunity to re-establish her credit—so much so that she didn’t mind taking a 45-minute bus drive from the north side of Chicago to our south side neighborhood to meet with me.

Like all Lending Circles participants that come to TRP, Sonia began by meeting with me one-on-one for an initial financial coaching session. Together, we reviewed her monthly income, budget and credit history, and we discovered several discrepancies on her credit report. While we completed her Lending Circles application, she reached out to the credit bureaus to address and resolve these inconsistencies.img_8302

At her Lending Circles formation in April, Sonia became a member of Los Ganadores—“The Victors.” As the name implies, Sonia has since won several small victories, leading her closer to her ultimate goal of rebuilding her credit and becoming a homeowner.

Since participating in Lending Circles at TRP, Sonia has increased her credit score by 65 points, decreased her debt by nearly $7,000, and increased her savings by $1,000.

Since joining Los Ganadores, Sonia has not only made significant strides in her personal finances, but she has also gained a new friend. Sonia and Alicia, another participant, connected at their Lending Circles formation and established a beautiful friendship. One wonderful aspect of the TRP Lending Circles program is the sense of community that participants form, both at the start of a circle and beyond. Alicia and Sonia formed a close bond through their Lending Circle. Alicia now volunteers at Sonia’s church food pantry and even joined Sonia at her wedding last May.

Sonia has embarked on the journey to make a new life for herself in Chicago, and we are so happy to support her in reaching her goal. Sonia will be telling her story in her own words at TRP’s next Lending Circles Brunch, where all of our participants come together to share their experiences and celebrate their accomplishments.

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About the Author:
 Madeline Cruz is a Senior Financial Coach at The Resurrection Project (TRP), which offers financial coaching, homeowner education, entrepreneurship support, and immigration services in Chicago, IL. She’s a featured speaker on the panel “True Heroes: Engaging Clients in the Digital Age” at the 2016 Lending Circles Summit.

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