Expanding Financial Inclusion: Housing

Twenty five million people in the United States have no credit score. Without a credit score, these individuals cannot get a loan to buy a car, start a business, or secure housing --all crucial to increasing a person's economic stability and the ability to contribute to his or her community. Housing is a basic need, which is why Citi continues to work with partners like Mission Asset Fund to make access to affordable housing a keep component of our shared efforts to broaden financial inclusion.

MAF's core focus is helping the unbanked access loans and build credit scores by formalizing loans traditionally created among peer groups outside of the mainstream banking system. The idea is simple: groups of people create lending circles that allow each member to chip in and give one participant a lump-sum, zero-interest, zero-fee loan. To date, MAF has managed more than $1.5 million in loans over four years with a default rate close to zero.

I'm proud that our innovative social lending model has garnered a lot of attention as a way to link participants with the mainstream credit system. Now, with help from our longtime supporter Citi Community Development, MAF is taking the next step to connect our underserved clients with housing that will enable them to continue to climb the economic ladder.

Lower-income young adults, foster youth and reentry populations often have no credit score and little savings to cover rent security deposits, creating real financial barriers to securing safe and stable places to live. Through an innovative pilot security deposit loan program, MAF will provide landlords and housing partners with vouchers for security deposits and will then service the interest-free loans, report repayment activity to credit bureaus, and return the deposit at the end of the lease term to borrowers. By the end of the program, young renters will have credit histories and seeded savings, putting them in a stronger position to rent apartments on their own and create the foundations that are critical to longer term success.

Jose Quinonez is a recipient of a 2013 James Irvine Foundation Leadership Award. Check out this video to learn more about how Mission Asset Fund supports financial inclusion:

Learn more about Citi's work with Mission Asset Fund at https://www.missionassetfund.org/news/84-lc-blog/123-mission-asset-fund-to-launch-security-deposit-loan-program