Bryant: Raising low credit scores will boost Detroit
Detroit is no newcomer to success. Nearly 60 years ago, Detroit was the wealthiest city in the world. Wealthier than London, wealthier than Paris and wealthier than New York.
Then Detroit hit a significant rough patch, lost its storyline, and today city leaders like Mayor Mike Duggan are working through all of that. But unlike many other places in distress, the fundamentals of Detroit are strong.
People have inner cities all wrong. They are not wastelands, they are gold mines. 50-60 years ago, inner cities were traditional bedroom communities. But for a range of reasons, middle class and upper middle class residents began to move out towards the suburbs. Back then, that was called quality of life. Today, people are tired of driving one to two hours each way, every day, just to get from home to work and back again. The quality of their lives is now increasingly being spent on highways and byways. And young college graduates seem to naturally love the gritty authenticity that a downtown inner city has to offer; in Detroit, and in major cities clear across America.
The reality is that inner-city neighborhoods are nothing more or less than centrally located real estate. They are close to downtown, close to the major transportation hubs and arteries. Close to the waterfront and their trade routes. Close to work, and play.
I believe in Detroit, and its people, and I believe that Detroit is positioned for a resurgence. That’s why Operation HOPE and I are making a bet on the city. We have partnered with Duggan, the Detroit Chamber of Commerce and Detroit Regional Chamber CEO Sandy Baruah, along with private sector partners such as Fifth-Third Bank, to bring Project 5117 and our solutions to Detroit. We opened our first HOPE Inside location at the Northwest Activities Center of Detroit, in partnership with Fifth Third Bank.
Every HOPE Inside location will provide HUD approved mortgage counseling, certified consumer credit counseling, SBA support for entrepreneurship and small business development, FDIC endorsed financial literacy training for youth and adults, highly engaged Consumer Financial Protection Bureau outreach, the budding of public services, such as the Earned Income Tax Credit, and most notably, HOPE 700 Credit Score Communities.
We are moving credit scores an average of 120 points over a two-year period, and at no cost to our clients. This is a game changer in people’s lives. As I keep saying, “nothing changes your life more, other than God or love, than moving your credit score 120 points.”
My plan is simple. In neighborhoods of Detroit where you see a check casher next to a payday lender next to a rent-to-own store next to a title lender next to a liquor store, you also have 500 credit scores. In other words, the challenge is not racism or other forms of discrimination, per se, but “target marketing.” These nontraditional financial players are simply targeting a 500 credit score customer. My mission is simple: I plan to rob these establishments of their customers. I plan to do it legally, transparently, within the letter of the law, and in the clear light of day. We will do it by raising credit scores to 700, neighborhood by neighborhood.
Real poverty, and real wealth, have little to do with money. Half of all poverty is simply low self-esteem and a lack of confidence and belief in oneself. The next rung of poverty is bad role models, and a bad environment.
As the saying goes, if you hang around nine broke people, you are likely to be the 10th.
Those looking for work begin to ask a basic empowering question, if I cannot get a job, can I create one, for myself?
Renters become homeowners. Small business dreamers become small business owners.
Liquor stores become convenience stores. Check cashers and payday lenders become banks and credit unions.
All boats begin to rise, when you focus on HOPE 700 Credit Score Communities as a signal for community sustainability and individual uplift. Predators and a lack of hope simply cannot survive very long in a 700-credit-score neighborhood. Everything changes, because everything has changed.
Our plan is simple. We will not simply give a man a fish. We will not simply help teach a man to fish. We are going to introduce an entire generation of Detroit constituents to a fundamentally new question: Can you own the lake?
John Hope Bryant is founder, chairman and CEO of financial dignity empowerment nonprofit Operation HOPE. He serves on the U.S. President’s Advisory Council on Financial Capability for Young Americans.
700 Credit Score Communities
For more information on Operation HOPE’s offerings, including its 700 Credit Score Communities project, visit operationhope.org