Today, Nora speaks excitedly about the prospect of buying a home. She shares the number of rooms she’d like to have, her ideal neighborhoods, and even hints at how she plans to decorate her kitchen. As she reaches the end of her second Lending Circle, she is developing the credit score and the sense of financial stability to soon turn her excitement into a reality. But behind Nora’s current success is a complex and incredible story – it’s a story that transcends credit and sheds light on the resilient and resourceful ways in which many Lending Circles participants have lived for decades.
Building a Life Together
Nora was born in Michoacan, a state on Mexico’s western coast. She immigrated to Los Angeles in 1988 in pursuit of a brighter future for herself and her family.
Three years after moving to Los Angeles from Mexico, Nora got married. She and her husband both worked hard, saved diligently, and began building a life together. In time, they bought a home and started a business, a transportation company that sold commercial trailers.
They were proud of their achievements. While it had been extremely hard work, they felt they were on the path to the “American Dream.”
The Great Recession
But, in 2007, Nora, along with millions of other individuals residing in the U.S., was a victim of the Great Recession. It was a period that devastated the wealth of families across the nation, especially immigrant communities and communities of color. Nora and her husband were among the estimated 10 million Americans displaced from their homes from 2007 to 2011. Along with their home, they lost their transportation business – the business that they had sacrificed so much to build. Nora and her husband were forced to file for bankruptcy. With this, their debts started multiplying.
Lifting the burden of debt
A few years later, feeling empowered to take steps towards rebuilding her life, Nora visited the Mexican American Opportunity Foundation (MAOF) (http://www.maof.org/), a nonprofit based in Los Angeles that is dedicated to providing economic opportunity for the Latino community in California while celebrating and uplifting the pride, values, and heritage of Mexican American culture.
As soon as she started working with MAOF, the staff enrolled her in their debt reduction program. It was a combination of her own perseverance and the knowledge and skills she gathered from her program that led to incredibly impressive results. Within a few years, Nora’s debt was reduced from $20,000 to a mere $20. With the burden of debt no longer looming over her, she felt more confident and hopeful. She could walk into work every day without the fear of being harassed by debt collectors. That was a liberating feeling.
“Words can’t describe the relief I felt when I got my debt cleared. I had so much stress and could not sleep. It was truly a victory.”
Resilience in the face of loss
But In 2014, Nora was once again hit with an immense challenge. After losing her husband to sudden illness, she was left to cope with a devastating personal loss while also managing a set of hospital and home payments all on her own.
She decided that it was time to downsize her life and move to a new city. Adapting to her new life and the resulting financial limitations was a tough transition for Nora. Without a strong credit score, it was hard for her to get an apartment to live comfortably and it was nearly impossible to apply for a credit card to help make ends meet. After speaking with MAOF staff members about how to build her credit score, she was introduced to Lending Circles.
MAOF has been a Lending Circles provider since 2014, offering Lending Circles, Lending Circles for Citizenship, and Lending Circles for DACA. So far, they’ve served around 200 clients, generating over $100,000 in loan volume.
Nora decided to join the Lending Circles program in 2016 to focus on repairing her credit. Within several months of completing her first Lending Circle, Nora’s score increased from 400 to 660. She applied for a credit card for the first time in years, and to her delight and pride, she was approved. Nora has since joined a second Lending Circle, and she is determined to continue building her credit score.
Nora has refused to let bankruptcy, debt, or any challenge keep her from pursuing her dreams
Her goal by participating in these “Cundinas,” a Spanish word for informal Lending Circles, is to re-build her credit score in order to eventually purchase a home. “I am tired of sharing a place with other families that I don’t know,” she says. She thinks back to those first few years of her time in the U.S. – after she had bought her first home and built her transportation business. Her journey has been tough, but she knows, with authority, that new doors will continue to open for her. “There’s still a long way to go, but I know I can do it,” she says.
Thank you to Maria Perez for her contributions to this story. Maria Perez, is a Financial Opportunity Center Supervisor at Mexican American Opportunity Foundation (MAOF).