The subprime mortgage crisis was a central cause of the recent recession. In short, lenders were providing expensive mortgages to low-income borrowers at an unprecedented rate. Once the housing bubble popped, subprime borrowers defaulted in droves, which helped push the deeply imbricated global financial system to the brink of collapse. Continue Reading
Members of Neighborhoods Organizing for Change (NOC), ISAIAH, and Minnesotans for a Fair Economy stood together outside Minneapolis City Hall to accuse banks of continuing to “red-line” communities of color and refusing to refinance sub-prime mortgages from 2009-2012. Accompanying the activists and researchers were three Minneapolis City Council members — Blong Yang, Elizabeth Glidden and Cam Gordon, all of whom called for something to be done.
The letters arrived at the end of a busy semester, the middle of summer, and even as recently as a few weeks ago, according to the Minnesota Chapter of the Council on American-Islamic Relations (CAIR-MN). They notified Minnesota students, families, and business owners that their TCF Bank accounts would be closed. Despite the fact that none of the letters provided an explanation for the account’s closure, TCF Bank maintains that they did not discriminate against their former customers. However, all of the account holders happened to have Muslim-sounding names.Since 2012, more than 30 bank accounts of Minnesota Muslims have been closed by TCF Bank. According to CAIR-MN, there are reports that account closures also are happening in other states.On February 27, CAIR-MN welcomed the decision by the Minneapolis Department of Civil Rights (MDCR) to file a Director’s Charge investigating the situation. Continue Reading
Tuesday is scheduled to be the day that everything changes. Not everything, really, but it’s the day that the “Volcker Rule” will finally go into effect. “Leave the capital markets to their own devices without any expectation of government protection and keep the existing safety net for the commercial banking system,” Volcker said in 2009. In practice, this means that commercial banking, with deposits backed by the FDIC, have to be separated from stock trading and similar activities. Continue Reading
Nearly half of teens feel “clueless” about money management, a TCF Bank-sponsored poll found.To help young people become more financially literate, Wayzata, Minn.-based TCF began offering money management classes this month, both online and at more than 100 high schools in the eight states where it has branches.Nationwide and at the University of Minnesota, the bank has been the subject of criticism for practices that target students, causing some to express concern about the potential effect of the classes.Last month, a U.S. Public Interest Research Group report, using data from the Consumer Financial Protection Bureau, found that TCF was the bank with the most complaints per billion dollars in deposits. Top complaints included overdraft fees and checking account issues.Associate family social science professor Catherine Solheim teaches personal finance classes, and said her students have opened TCF accounts for questionable reasons.“It’s not illegal, but it verges on taking advantage of people who really don’t know a lot about financial management,” she said. “You can go up to a line that’s still legal but borders on predatory, particularly for vulnerable audiences.”Architecture senior Lindsey May said she opened an account with TCF during her freshman year because she felt a “big push” from the University to do so.“It was confusing, based on what they told us, whether it was tied to your U Card or how the card worked,” she said.May said she doesn’t feel she has a good understanding of personal finance, because she’s never taken any formal classes.Mark Goldman, TCF’s director of corporate communication, said financial literacy is a critical topic in today’s personal finance environment.“One of the things that has become increasingly clear is that level of financial literacy, particularly for young people, but also just for the adult population in general, is really lacking,” he said.Of the 500 teenagers surveyed nationwide in the TCF poll, 90 percent said they’re not learning everything they need to know about money management.Along with the poll, TCF declared a goal to improve the financial literacy of 2 million people over the next three years with its classes.In a press release, TCF Vice Chairman Tom Jasper called the classes “a genuine effort to help people become better consumers of financial services.”“I guess I’m glad if they are genuinely offering education,” Solheim said. “Because they are trying to rectify something that is getting people into trouble, which is those overdraft fees and those tricks around accounts that cost people money.”Solheim said students often don’t compare or change banks, so they tend to be long-term customers with their first bank. Sponsoring finance classes also gives TCF brand recognition at an early age, she said.“A good question is, ‘If a 16-year-old has a financial management course sponsored by TCF, would they be likely to bank at TCF in the future?’”‘Banks don’t overdraft; individuals overdraft’TCF charged global studies junior Molly Rinehart about $60 in overdraft fees after an online money transfer took multiple days.“I wasn’t really happy about it, because I would have paid or put money in my account if I knew right away,” she said. Continue Reading
This could be a story about unbridled greed. Or about making money without regard to consequences. Perhaps, it is a tale that simply exemplifies responsible real estate investing as defined by Chris Gleize of Northern Value Group. Chris figures large as a protagonist in this drama. But I will let you, the reader, draw your own conclusions. A good percentage of the information provided in this story comes from public court documents. Other information was provided by Mr. Gleize’s attorney and the homeowner who is now subject to immediate eviction. Nafeesah a strong, middle aged woman who has lived in single family four bedroom house since 1991 is the other major player in this unfolding narrative. Just down the block from from Lake Street, it has stood in its present location since 1904! Continue Reading
Fed up with banks? You’re hardly alone. Credit unions have grown dramatically in the last 20 years, fueled largely by high fees charged by commercial banks. Low rates for ordinary loans are also a big draw. But for all the growth, not much has been written about credit unions other than the occasional puffy story about how much a consumer can save by ditching their bank. That’s not to say that the growth has gone unnoticed at all – or indeed that it isn’t creating its own problems that need to be addressed. Continue Reading