Initiative helps build credit
Boston Builds Credit aimed at helping 25,000 Hub residents
Mayor Press Office | 11/1/2017, 11:24 a.m.
The city of Boston’s Office of Financial Empowerment (OFE) last week launched a first-in-the-nation citywide credit building initiative, Boston Builds Credit, aimed at helping at least 25,000 Boston residents attain a credit score of at least 660 by the year 2025 through financial education and one-on-one financial coaching. The program will be launched in Roxbury, and will expand to Dorchester and Mattapan in the following years.
On the Web
For up-to-date information on BBC, please visit www.bostonbuildscredit.org
Additional information about the Office of Financial Empowerment may be found at www.ofe.boston.gov
The program is a partnership between the OFE, United Way of Massachusetts Bay and Merrimack Valley, and LISC Boston. The planning process and program development is supported by a grant from Citi Community Development, and funding from Bank of America.
Mayor Martin Walsh announced Boston Builds Credit, and the related program Bank On Boston, at an event welcoming the Cities for Financial Empowerment Coalition conference to Boston. The CFE Coalition is a nonprofit that works to improve the financial stability of low-and-moderate income households through local government. Boston was selected to become a member of the Coalition in 2015.
In Boston, an estimated 100,000 people do not have a credit score, and 136,000 have a poor credit score. These individuals pay higher interest and fees on mortgages, home insurance, car loans, and college financing, causing “expense inequality,” a term used to describe the sustained overpayment of interest and fees on financial products.
A good credit history is a prerequisite for everyday financial products and services such as low-cost credit cards, bank accounts or car loans. Renting an apartment, paying for home insurance, signing up for utilities and even landing a job can also be affected by a person’s credit history, or the absence of one. A good credit score is necessary to attain the tools to access a college degree, buy a home, or start and grow a small business.
BBC’s interim goal is to help 3,000 Bostonians achieve a prime score and/or average credit score increase of 30 points over the next three years.
United Way has convened many of the partners over the past few months, including community-based organizations, employers and financial institutions to develop the initiative and raise funds, as well as provide training to financial coaches in partnership with the Credit Builders Alliance. In addition to its partnership with Boston Builds Credit, United Way this year is also investing over $600,000 in community-based organizations in Boston to support financial coaching and credit-building work.
“We are grateful for the collaboration of so many committed community and funding partners who are participating in this initiative and who will be working with us to promote economic prosperity for all Bostonians,” said Michael K. Durkin, United Way president and chief executive officer.
The City and its partners, in collaboration with numerous community partners, have developed the following plan to guide BBC’s implementation:
1.Implement citywide strategies: