CU Breathes New Life Into Baltimore
Destinations CU partnered with Operation Hope to help CU and community members get back on track financially.
In 1975, four of Baltimore, Md.’s leading advertising executives and creative directors gathered together, at then Mayor William Donald Schaefer’s request, to come up with an idea to promote the city and combat its troubled image, according to an article in the Baltimore Sun. Not long after, a new nickname for the city was born – Charm City.
The nickname, albeit a creative marketing tool, holds true; Baltimore is a city full of charm. Baltimore’s inner harbor is a scenic area lined with restaurants, shops, bars and an aquarium. The inner harbor boasts beautiful views of the water and boats passing through its waterways. The city is also full of historic neighborhoods such as Fell’s Point, an area established in 1763 that has more than 161 buildings on the National Register, including the oldest standing residence in Baltimore City, the Robert Long House, according to Baltimore.org.
With all its charm, Baltimore is a multi-faceted city that still comes with its fair share of problems, much like other major U.S. cities. The television crime drama “The Wire” brought new celebrity to this city by the water and put a large spotlight on its troubles as well. The 2015 Baltimore riots, sparked by the death of Freddie Gray, who died in police custody, renewed national attention to a city fraught with economic and racial tensions.
These sobering statistics are a reminder of the city’s issues: Baltimore has a high crime rate and higher unemployment than the national average – 5.6% versus the national average of 3.8%, according to the June 2019 Bureau of Labor Statistics. The median income is also lower than the national average. A 2016 article by the Baltimore Sun said the city came in dead last in a CreditCards.com report that evaluated how well residents of 25 metropolitan areas manage their credit.
However, the $63 million Destinations Credit Union in Baltimore is doing something to change some of these statistics.
President/CEO Brian Vittek said Destinations has been working to improve the credit scores and financial standings of his membership since he joined the organization 19 years ago, but it’s been a challenge. When he heard about Operation Hope – a non-profit organization working to disrupt poverty and empower inclusion for low and moderate-income youth and adults, he felt a renewed sense of optimism.
After getting approval from his board, Destinations partnered with Operation Hope to help credit union members and members of the community get back on track and stay on track financially.
Through the credit union’s partnership with Operation Hope, a financial well-being coach sits onsite at the credit union’s Parkville branch, and provides free credit and money management education and coaching. The program is available to the entire Greater Baltimore community, not just members of Destinations.
“With our official industry mantra of ‘people helping people,’ this is the work credit unions need to do. All members and local residents deserve the opportunity to receive financial dignity,” Vittek said.
Operation Hope is the brainchild of notable entrepreneur John Hope Bryant, founder, chairman and CEO of the organization. Bryant believes financial literacy is one of the keys to breaking the cycle of poverty.
Thus far his organization “has aided over 2.8 million individuals worldwide and directed more than $2.7 billion in economic activity for the disenfranchised – turning check-cashing customers into banking customers, renters into homeowners, small business dreamers into small business owners and minimum wage workers into living wage consumers,” according to Operation Hope’s website.
At Destinations, Yolanda Hobbs, the financial well-being coach for Operation Hope, is helping Destinations members and community members get back on track. Hobbs and the credit union’s onsite collector work together to identify members in need of financial coaching.
“One of the things people say is that they felt like they had no hope. There’s a lot of shame that comes with having bad credit. There are a lot of dreams that aren’t thought about, dreams are undreamt with bad credit. So people treat themselves very bad based on that score, so when they walk into my office I give them hope,” Hobbs said.
Hobbs recalled that when clients come into her office, she always tries to identify their why or purpose for wanting to have better credit and financial well-being. “Just for the sake of having good credit is a beautiful why, but for most of the people I see it’s deeper than that. [It may be,] ‘I want to be the first one to own a home in my family. I want to be the first one to send my children to college,’” she said. She emphasized that having a purpose gives clients motivation and something tangible to work toward.
She helps clients develop a budget to accomplish three main financial goals: Reduce debt, increase their credit score and increase savings. Hobbs will often sit down with clients and contact creditors to make payment arrangements or arrange for settlements. She’s also helped with loan consolidation, credit report disputes and a variety of other matters. She does this so clients can learn and know how to do it themselves should they need to in the future.
According to Destinations, in just the first quarter since opening the HOPE Inside office at the credit union, Destinations has seen the following results:
- A client’s home was prevented from going into foreclosure.
- Clients’ average credit scores went up by 56 points.
- Savings balances went up an average of $382.
- Average debt went down by $9,350.
Hobbs also goes into the community to teach workshops and meet with clients. Since January, she’s taught approximately 222 people via financial education workshops and has provided one-on-one financial counseling to 65 members.
She said she enjoys seeing the snowball effect of helping people. For example, she helped a woman who was behind on her mortgage and car payment. The stress of her financial situation was making her physically ill. Hobbs sat down with the woman to help her develop a budget and payment cycle for each of her bills. Through the coaching Hobbs provided, the woman was able to get current on her payments and even put some money in savings. In turn, the woman’s health has improved and her blood pressure is lower. Now the woman wants Hobbs to come to her church to provide quarterly financial education workshops so others can get the help she did.
“Think of the difference our programs make in people’s lives as they improve their FICO scores by 100 points or more, think about the impact on families and communities as more people and more local businesses succeed … We are proud to partner with Destinations Credit Union to bring meaningful impact to the residents of this community and beyond,” Bryant emphasized.
Baltimore has character, history and a dynamic story to tell. Through the partnership with Operation Hope and Destinations, these two organizations are aiming to tell a story of how they renewed hope and improved credit scores in Charm City.