As the new week begins, mortgage rates are almost perfectly in line with those seen on Friday afternoon. Putting that in context, last Thursday and Friday marked the highest rates in weeks although Friday was quite a bit better. In both cases and again today, the average lender is just over 7% for a top tier conventional 30yr fixed scenario.
Last Thursday’s drama stemmed from strong economic data. That sort of data is a key consideration for rate movement in general, but especially right now. The Fed is scrutinizing data to determine whether it’s time to hold rates steady after hiking at the fastest pace since the early 80s.
While the Fed Funds Rate doesn’t dictate mortgage rates, the expectations for future movement in the Fed Funds Rate is much more correlated. Even then, the general notion of “friendly vs unfriendly” Fed policy tends to align with “down vs up” for interest rates. Bottom line: weak data = friendly Fed. Strong data = unfriendly Fed.
With all that in mind, we have some of the month’s most important economic data coming up this week, culminating in Friday’s big jobs report–typically considered to be the most important report for bonds/rates.
The Jefferson Avenue commercial district in Buffalo, New York, is anchored by a supermarket.
There are dozens of other businesses and services along the 12-block corridor — a couple of bank branches, a library, a coffee shop, gas stations, a small plaza with a dollar store and a primary care clinic and a business incubator for entrepreneurs of color.
But Tops Friendly Markets, the only grocery store on Buffalo’s vast East Side, is the center of activity. More than just a place to buy food, pick up medications and use an ATM, the store is a communal gathering space in a predominantly Black neighborhood that, for generations, has been segregated, isolated and disenfranchised from the wealthier — and whiter — parts of the city.
Which explains how it came to be the site of a mass shooting on a spring day in May of last year. On that Saturday, a gunman, who lived 200 miles away in another part of the state, drove to Jefferson Avenue and went into Tops, and in just a few minutes killed 10 people, injured three and inflicted mass trauma across the community.
It is a scenario that has sadly, and repeatedly, played out in other parts of the country that have experienced mass shootings. But this one came with a twist: The gunman’s intention was to kill as many Black people as possible.
To achieve that, he specifically targeted a ZIP code with one of the highest percentages of Black residents in New York state. All 10 who died that day were Black.
“The mere fact that someone can research, ‘Where will the greatest number of Black people be … on a Saturday morning,’ that’s not by chance,” said Franchelle Parker, a community organizer and executive director of Open Buffalo, a nonprofit focused on racial, economic and ecological justice. “That’s not a mistake. It’s a community that’s been deeply segregated for decades.”
The day of the shooting, Parker, who grew up in nearby Niagara Falls, was driving to Tops, where she planned to buy a donut and an unsweetened iced tea before heading into the Open Buffalo office, which is located a block away from Tops. The mother of two had intended to complete the mundane task of cleaning up her desk — “old coffee cups and stuff” — after a busy week.
Franchelle Parker, executive director of Open Buffalo, stands in front of a mural that was created after the May 14, 2022, shooting at Tops Friendly Markets in Buffalo, New York.
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She saw the news on Twitter and didn’t know if she should keep driving to Jefferson Avenue or turn around and go back home. She eventually picked the latter.
When she showed up the next day, there were thousands of people grieving in the streets. “The only way that I could explain my feeling, it was almost like watching an old war movie when a bomb had gone off and someone’s in, like, shell shock. That’s how it felt,” said Parker, vividly recounting the community’s collective trauma in a meeting room tucked inside of Open Buffalo’s second-story office on Jefferson Avenue.
Almost immediately following the May 14, 2022, massacre, which was the second-deadliest mass shooting in the United States last year, conversations locally and nationally turned to the harsh realities of the East Side and how long-standing factors that affect the daily life of residents — racism, poverty and inequity — made the community an ideal target for a white supremacist.
Now, more than a year after the tragedy, there is growing concern that not enough is being done fast enough to begin to dismantle those factors. And amid those conversations, there are mounting calls for the banking industry — whose historical policies and practices helped cement the racial segregation and disinvestment that ultimately shaped the East Side — to leverage its collective power and influence to band together in an effort to create systemic change.
The ideas about how banks should support the East Side and better embed themselves in the neighborhood vary by people and organizations. But the basic argument is the same: Banks, in their role as financiers and because of the industry’s history of lending discrimination, are obligated to bring forth economic prosperity in disinvested communities like the East Side.
I know banks are often looked upon sort of like a panacea, but I don’t particularly see it that way. I think others have a role to play in all of this.
Chiwuike Owunwanne, corporate responsibility officer at KeyBank
“Banks have been very good at providing charitable contributions to the Black community. They get an ‘A’ for that,” said The Rev. George Nicholas, an East Side pastor who is also CEO of the Buffalo Center for Health Equity, a four-year-old enterprise focused on racial, geographic and economic health disparities. “But doing the things that banks can do in terms of being a catalyst for revitalization and investment in this community, they have not done that.”
To be sure, banks’ ability to reverse the course of the community isn’t guaranteed — and there is no formula to determine how much accountability they should hold to fix deeply entrenched problems like racism. Several Buffalo-area bankers said that while the Tops shooting heightened the urgency to help the East Side, the industry itself cannot be the sole driver of change.
“There are a lot of institutions … that can certainly play a part in reversing the challenges that we see today,” said Chiwuike “Chi-Chi” Owunwanne, a corporate responsibility officer at KeyBank, the second-largest bank by deposits in Buffalo. “I know banks are often looked upon sort of like a panacea, but I don’t particularly see it that way. I think others have a role to play in all of this.”
This federal underwriting map from 1937 shows how redlining worked. Neighborhoods that were predominantly minority were given the lowest ratings, which were color coded red.
Residential Security Map Buffalo N.Y. City Survey File. Record Group 195. National Archives II College Park MD. Image courtesy of Carl Nightingale.
A long history of segregation
How the East Side — and the Tops store on Jefferson Avenue — became the destination for a racially motivated mass murderer is a story about racism, segregation and disinvestment.
Even as it bears the nickname “the city of good neighbors,” Buffalo has long been one of the most racially segregated cities in the United States. Of the 114,965 residents who live on the East Side, 59% are Black, according to data from the 2021 U.S. Census American Community Survey. The percentage is even higher in the 14208 ZIP code, where the Tops store is located. In that ZIP code, among 11,029 total residents, nearly 76% are Black, the census data shows.
The city’s path toward racial segregation started in the early 20th century when a small number of job-seeking Black Americans migrated north to Buffalo, a former steel and auto manufacturing hub at the far northwestern end of New York state. Initially, they moved into the same neighborhoods as many of the city’s poorer immigrants and lived just east of what is today the city’s downtown district. As the number of Blacks arriving in Buffalo swelled in the 1940s, they were increasingly confronted with various housing challenges, including racist zoning laws and restrictive deed covenants that kept them from buying homes in more affluent white areas.
Black Buffalonians also faced housing discrimination in the form of redlining, the practice of restricting the flow of capital into minority communities. In 1933, as the Great Depression roiled the economy, a temporary federal agency known as the Home Owners’ Loan Corporation used government bonds to buy out and refinance mortgages of properties that were facing or already in foreclosure. The point was to try to stabilize the nation’s real estate market.
“I know banks are often looked upon sort of like a panacea, but I don’t particularly see it that way. I think others have a role to play in all of this,” said Chiwuike Owunwanne, a corporate responsibility officer at KeyBank.
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As part of its program, HOLC created maps of American cities, including Buffalo, that used a color coding scheme — green, blue, yellow and red — to convey the perceived riskiness of making loans in certain neighborhoods. Green was considered minimally risky; other areas that were largely populated by immigrant, Black or Latino residents were labeled red and thus determined to be “hazardous.”
“The goal was to free up mortgage capital by going to cities and giving banks a way to unload mortgages, so they could turn around and make more mortgage loans,” said Jason Richardson, senior director of research at the National Community Reinvestment Coalition, an association of more than 750 community-based organizations that advocates for fair lending. “It was kind of a radical concept and it has evolved over the decades into our modern mortgage finance system.”
The Federal Housing Administration, which was established as a permanent agency in 1934, used similar methods to map urban areas and labeled neighborhoods from “A” to “D,” with “A” considered to be the most financially stable and “D” considered the least. Neighborhoods that were largely Black, even relatively stable ones, were put in the “D” category.
The result was that banks, which wanted to be able to sell mortgage loans to the FHA, were largely dissuaded from making loans in “risky” areas. And Buffalo’s East Side, where the majority of Blacks were settling, was deemed risky. Unable to get loans, Blacks couldn’t buy homes, start businesses or build equity. At the same time, large industrial factories on the East Side were closing or moving away, limiting job opportunities and contributing to rising poverty levels.
“Today what we’re left with is the residue of this process where we’ve enshrined … a pattern of economic segregation that favors neighborhoods that had fewer Black people in them and generally ignores neighborhoods that had African Americans living in them,” Richardson said.
Case in point: Research by the National Community Reinvestment Coalition shows that three-quarters of neighborhoods that were once redlined are low- to moderate-income neighborhoods today, and two-thirds of them are majority minority communities.
Adding to the division between Blacks and whites in Buffalo was the construction of a highway called the Kensington Expressway. Built during the 1960s, the below-grade, limited-access highway proved to be a speedy way for suburban workers to get to their downtown jobs. But its construction cut off the already-segregated East Side even more from other parts of the city, displacing residents, devaluing houses and destroying neighborhoods and small businesses.
As a result of those factors and more, many Black residents have become “trapped” on the East Side, according to Dr. Henry Louis Taylor Jr., a professor of urban and regional planning at the University at Buffalo. In 1987, Taylor founded the UB Center for Urban Studies, a research, neighborhood planning and community development institute that works on eliminating inequality in cities and metropolitan regions. In September 2021, eight months before the Tops shooting, the Center for Urban Studies published a report that compared the state of Black Buffalo in 1990 to present-day conditions. The conclusion: Nothing had changed for Blacks over 31 years.
As of 2019, the Black unemployment rate was 11%, the average household income was $42,000 and about 35% of Blacks had incomes that fell below the poverty line, the report said. It also noted that just 32% of Blacks own their homes and that most Blacks in the area live on the East Side.
“Those figures remain virtually unchanged while the actual, physical conditions that existed inside of the community worsened,” Taylor told American Banker in an interview in his sun-filled office at the center, located on the University at Buffalo’s city campus. “When we looked upstream to see what was causing it, it was clear: It was systemic, structural racism.”
Last fall, BankOnBuffalo launched a mobile bank on wheels truck that’s stationed on the East Side every Wednesday. Michael Noah, president of BankOnBuffalo, said that the shooting at Tops Friendly Markets “cemented the point that this is a place we need to be, to be able to be part of these communities and this community specifically, and be able to build this community up.”
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Banks’ moral obligations
As the East Side struggled over the decades with rampant poverty, dilapidated housing, vacant lots and disintegrating infrastructure, banks kept a physical presence in the community, albeit a shrinking one. In mid-2000, there were at least 20 bank branches scattered across the East Side, but by mid-2022, the number had fallen to around 14, according to the Federal Deposit Insurance Corp.’s deposit market share data. The 14 include four new branches that have opened since early 2019 — Northwest Bank, KeyBank, Evans Bank and BankOnBuffalo.
The first two branches, operated by Northwest in Columbus, Ohio, and KeyBank, the banking subsidiary of KeyCorp in Cleveland, were requirements of community benefits agreements negotiated between each bank and the National Community Reinvestment Coalition. In both cases, Northwest and KeyBank agreed to open an office in an underserved community.
Evans Bank opened its first East Side branch in the fall of 2021. The office is located in the basement of an $84 million affordable senior housing building that was financed by Evans, a $2.1 billion-asset community bank headquartered south of Buffalo in Angola, New York.
Banks have been very good at providing charitable contributions to the Black community. They get an ‘A’ for that. But doing the things that banks can do in terms of being a catalyst for revitalization and investment in this community, they have not done that.
The Rev. George Nicholas, an East Side pastor who is also CEO of the Buffalo Center for Health Equity
On the community and economic development front, banks have had varying levels of participation. Buffalo-based M&T Bank, which holds a whopping 64% of all deposits in the Buffalo market and is one of the largest private employers in the region, has made consistent investments in the East Side by supporting Westminster Community Charter School, a kindergarten through eighth-grade school, and the Buffalo Promise Neighborhood, a nonprofit organization focused on improving access to education in the city’s 14215 ZIP code.
Currently, Buffalo Promise Neighborhood operates four schools. In addition to Westminster, it runs Highgate Heights Elementary, also K-8, as well as two academies that serve children ages six weeks through pre-kindergarten. Twelve M&T employees are dedicated to the program, according to the Buffalo Promise Neighborhood website. The bank has invested $31.5 million into the program since its 2010 launch, a spokesperson said.
Other banks are making contributions in other ways. In addition to the Jefferson Avenue branch and as part of its community benefits plan, Northwest Bank, a $14.2 billion-asset bank, supports a financial education center through a partnership with Belmont Housing Resources of Western New York. Meanwhile, the $198 billion-asset KeyBank gave $30 million for bridge and construction financing for Northland Workforce Training Center, a $100 million redevelopment project at a former manufacturing complex on the East Side that was partially funded by the state.
BankOnBuffalo’s East Side branch is located inside the center, which offers KeyBank training in advanced manufacturing and clean energy technology careers. A subsidiary of $5.6 billion-asset CNB Financial in Clearfield, Pennsylvania, BankOnBuffalo’s office opened a month after the shooting. The timing was coincidental, but important, said Michael Noah, president of BankOnBuffalo.
“I think it just cemented the point that this is a place we need to be, to be able to be part of these communities and this community specifically, and be able to build this community up,” Noah said.
In terms of public-private collaboration, some banks have been involved in a deeper way. In 2019, New York state, which had already been pouring $1 billion into Buffalo to help revitalize the economy, announced a $65 million economic development fund for the East Side. The initiative is focused on stabilizing neighborhoods, increasing homeownership, redeveloping commercial corridors including Jefferson Avenue, improving historical assets, expanding workforce training and development and supporting small businesses and entrepreneurship.
In conjunction with the funding, a public-private partnership called East Side Avenues was created to provide capital and organizational support to the projects happening along four East Side commercial corridors. Six banks — Charlotte, North Carolina-based Bank of America, the second-largest bank in the nation with $2.5 trillion of assets; M&T, which has $203 billion of assets; KeyBank; Warsaw, New York-based Five Star Bank, which has about $6 billion of assets; Northwest and Evans — are among the 14 private and philanthropic organizations that pledged a combined $8.4 million to pay for five years’ worth of operational support, governance and finance, fundraising and technical assistance to support the nonprofits doing the work.
Laura Quebral, director of the University at Buffalo Regional Institute, which is managing East Side Avenues, said the banks were the first corporations to step up to the request for help, and since then have provided loans and other products and education to keep the program moving.
Their participation “is a signal to the community that banks cared and were invested and were willing to collaborate around something,” Quebral said. “Being at the table was so meaningful.”
Richard Hamister is Northwest’s New York regional president and former co-chair of East Side Avenues. Hamister, who is based in Buffalo, said banks are a “community asset” that have a responsibility to lift up all communities, including those where conditions have arisen that allow it to be a target of racism like the East Side.
“We operate under federal charters, so we have an obligation to the community to not only provide products and services they need but also support when you go through a tragedy like that,” Hamister said. “We also have a moral obligation to try to help when things are broken … and to do what we can. We can’t fix everything, but we’ve got to fix our piece and try to help where we can.”
Allison Dehonney, founder of Buffalo Go Green, distributes strawberries at the Delavan-Grider Farmers’ Market. For a second year, KeyBank is sponsoring the event in the East Side as an attempt to help fill the food desert there. The community’s only grocery store, Tops Friendly Markets, was the site of the mass shooting last year.
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In the wake of a tragedy
After the massacre, there was a flurry of activity within banks and other organizations, local and out-of-town, to respond to the immediate needs of East Side residents. With the community’s only supermarket closed indefinitely, much of the response centered around food collection and distribution. Three of M&T’s five East Side branches, including the Jefferson Avenue branch across the street from Tops, became food distribution sites for weeks after the shooting. On two consecutive Fridays, Northwest provided around 200 free lunches to the community, using a neighborhood caterer who is also the bank’s customer. And BankOnBuffalo collected employee donations that amounted to more than 20 boxes of toiletries and other items that were distributed to a nonprofit.
At the same time, M&T, KeyBank and other banks began financial donations to organizations that could support the immediate needs of the community. KeyBank provided a van that delivered food and took people to nearby grocery stores. Providence, Rhode Island-based Citizens Financial Group, whose ATM inside Tops was inaccessible during the store’s temporary closure, installed a fee-free ATM near a community center located about a half-mile north of Tops, and later put a permanent ATM inside the center that remains there today. And M&T rolled out a short-term loan program to provide capital to East Side small-business owners.
One of the funds that benefited from banks’ support was the Buffalo Together Community Response Fund, which has raised $6.2 million to address the long-term needs of the East Side.
Bank of America and Evans Bank each donated $100,000 to the fund, whose list of major sponsors includes four other banks — JPMorgan Chase, Citigroup, M&T and KeyBank. Thomas Beauford Jr., a former banker who is co-chair of the response fund, said banks, by and large, directed their resources into organizations where the dollars would have an immediate impact.
“Banks said, ‘Hey, you know … it doesn’t make sense for us to try to build something right now. … We will fund you in the work you’re doing,'” said Beauford, who has been president and CEO of the Buffalo Urban League since the fall of 2020. “I would say banks showed up in a big way.”
Fourteen months later, banks say they are committed to playing a positive role on the East Side. For the second year, KeyBank is sponsoring a farmers’ market on the East Side, an attempt to help fill the food desert in the community. Last fall, BankOnBuffalo launched a mobile “bank on wheels” truck that’s stationed on the East Side every Wednesday. The 34-foot-long truck, which is staffed by two people and includes an ATM and a printer to make debit cards, was in the works before the shooting, and will eventually make four stops per week around the Buffalo area.
Evans has partnered with the city of Buffalo to construct seven market-rate single family homes on vacant lots on the East Side. The relationship with the city is an example of how banks can pair up with other entities to create something meaningful and lasting, more than they might be able to do on their own, said Evans President and CEO David Nasca.
The bank has “picked areas” where it can use its resources to make a difference, Nasca said.
“I don’t think the root causes can be ameliorated” by banks alone, he said. “We can’t just grant money. It has to be within our construct of a financial institution that invests and supports the public-private partnership. … All the oars [need to be] pulling together or this doesn’t work.”
KeyBank is currently being accused of redlining by the National Community Reinvestment Coalition. Buffalo is one of several cities where the bank’s mortgage lending “effectively wall[ed] out Black neighborhoods,” especially parts of the East Side, according to a 2022 report from the group.
Bloomberg News
‘Little or no engagement with minorities’
All of these efforts are, of course, welcomed by the community, but there is still criticism that banks haven’t done enough to make up for their past contributions to segregating the city. And perhaps more importantly, some of that criticism centers on banks failing to do their most basic function in society — provide credit.
In 2021, the New York State Department of Financial Services issued a report about redlining in Buffalo. The regulator looked at banks and nonbank lenders and found that loans made to minorities in the Buffalo metro area made up 9.74% of total loans in Buffalo. Overall, Black residents comprise about 33% of Buffalo’s total population of more than 276,000, census data shows.
The department said its investigation showed the lower percentage was not due to “excessive denials of loan applications based on race or ethnicity,” but rather that “these companies had little or no engagement with minorities and generally made scant effort to do so.”
“The unsurprising result of this has been that few minority customers or individuals seeking homes in majority-minority neighborhoods have made loan applications … in the first instance.”
Furthermore, accusations of redlining persist today, even though the practice of discriminating in housing based on race was outlawed by the Fair Housing Act of 1968.
In 2014, Evans was accused of redlining by the New York State Attorney General, which said the community bank was specifically avoiding making mortgage loans on the East Side. The bank, which at the time had $874 million of assets, agreed to pay $825,000 to settle the case, but Nasca maintains that the charges were unfounded. He points to the fact that the bank never had a fair lending or fair housing violation, no specific incidents were ever claimed and that the bank’s Community Reinvestment Act exam never found evidence of discriminatory or illegal credit practices.
The bank has a greater presence on the East Side today, but that’s because it has grown in size, not because it is trying to make up for previous accusations of redlining, he said.
“Ten years ago, our involvement [on the East Side] certainly wasn’t what you’re seeing today,” Nasca said. “We were looking to participate more, but we were participating within our means and our reach. As we have grown, we have built more resources to be able to do more.”
Shortly after accusations were made against Evans, Five Star Bank, the banking arm of Financial Institutions in Warsaw, New York, was also accused of redlining by the state Attorney General. Five Star, which has been growing its presence in the Buffalo market for several years, wound up settling the charges for $900,000 and agreeing to open two branches in the city of Rochester.
KeyBank is currently being accused of redlining by the National Community Reinvestment Coalition. In a 2022 report, the group said that KeyBank is engaging in systemic redlining by making very few home purchase loans in certain neighborhoods where the majority of residents are Black. Buffalo is one of several cities where the bank’s mortgage lending “effectively wall[ed] out Black neighborhoods,” especially parts of the East Side, the report said.
KeyBank denied the allegations. In March, the coalition asked regulators to investigate the bank’s mortgage lending practices.
Beyond providing more credit, some community members believe that banks should be playing a larger role in addressing other needs on the East Side. And the list of needs runs the gamut from more grocery stores to safe, affordable housing to infrastructure improvements such as street and sidewalk repairs.
Alexander Wright is founder of the African Heritage Food Co-op, an initiative launched in 2016 to address the dearth of grocery store options on the East Side, where he grew up. Wright said that while banks’ philanthropic efforts are important, banks in general “need to be in a place of remediation” to fix underlying issues that the industry, as a whole, helped create. (After publication of this story, Wright left his job as CEO of the African Heritage Food Co-Op.)
Aside from charitable donations, banks should be finding more ways to work directly with East Side business owners and entrepreneurs, helping them with capital-building support along the way, Wright said. One place to start would be technical assistance by way of bank volunteers.
“Banks are always looking to volunteer. ‘Hey, want to come out and paint a fence? Want to come out and do a garden?'” Wright said. “No. Come out here and help Keshia with bookkeeping. Come out here and do QuickBooks classes for folks. Bring out tax experts. Because these are things that befuddle a lot of small businesses. Who is your marketing person? Bring that person out here. Because those are the things that are going to build the business to self-sufficiency.
“Anything short of the capacity-building … that will allow folks to rise to the occasion and be self-sufficient I think is almost a waste,” Wright added. “We don’t need them to lead the plan. What we need them to do is be in the community and [be] hearing the plan and supporting it.”
Franchelle Parker, a community organizer and executive director of Open Buffalo.
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Parker, of Open Buffalo, has similar thoughts about the role that banks should play. One day, soon after the massacre, an ATM appeared down the street from Tops, next to the library that sits across the street from Parker’s office. Soon after the ATM was installed, Parker began fielding questions from area residents who were skeptical of the machine and wanted to know if it was legitimate. But Parker didn’t have any information to share with them. “There was no outreach. There was no community engagement. So I’m like, ‘Let me investigate,'” she said. “I think that’s a symptom of how investment is done in Black communities, even though it may be well-intentioned.”
As it turns out, the temporary ATM belonged to JPMorgan Chase. The megabank has had a commercial banking presence in Buffalo for years, but it didn’t operate a retail branch in the region until last year. Today it has four branches in operation and plans to open another two by the end of the year, a spokesperson said.
After the Tops shooting, the governor’s office reached out to Chase asking if the bank could help in some way, the spokesperson said in response to the skepticism. The spokesperson said that while the Chase retail brand is new to the Buffalo region, the company has been active in the market for decades by way of commercial banking, private banking, credit card lending, home lending and other businesses.
In addition to the ATM, the bank provided funding to local organizations including FeedMore Western New York, which distributes food throughout the region.
“We are committed to continuing our support for Buffalo and helping the community increase access to opportunities that build wealth and economic empowerment,” the spokesperson said in an email.
In the year since the massacre, there has been some progress by banks in terms of their interest in listening to the East Side community and learning about its needs, said Nicholas. But he hasn’t felt an air of urgency from the banking community to tackle the issues right now.
“I do experience banks being a little more open to figuring out what their role is, but it’s slow. It’s slow,” said Nicholas. The senior pastor of the Lincoln Memorial United Methodist Church, located about a mile north from Tops, Nicholas is part of a 13-member local advisory committee for the New York arm of Local Initiatives Support Coalition, or LISC. The group is focused on mobilizing resources, including banks, to address affordable housing in Western New York, specifically in the inner city, as well as training minority developers and connecting them to potential investors, Nicholas said.
Of the 13 members, seven are from banks — one each from M&T, Bank of America, BankOnBuffalo, Evans and KeyBank, and two members from Citizens Financial Group. One of the priorities of LISC NY is health equity, and the fact that banks are becoming more engaged in looking at health disparities is promising, Nicholas said. Still, they have more work to do, he said.
Deja Griffin, an associate at BankOnBuffalo, sets up inside the institution’s bank on wheels. The 34-footlong truck, which is staffed by two people and includes an ATM and a printer to make debit cards, will eventually make four stops per week around the Buffalo area.
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“I need them to think more on how to strengthen and build the economy on the East Side and provide leadership around that, not only to provide charitable things, but using sound business and banking and community development principles to say, ‘OK, if we’re going to invest in this community, these are the types of things that need to happen in this community,’ and then encourage their partners and other people they work with … to come fully in on the East Side.”
Some bankers agree with the community activists.
“Putting a branch in is great. Having a bank on wheels is great,” said Noah of BankOnBuffalo. “But if you’re not embedded in the community, listening to the community and trying to improve it, you’re not creating that wealth and creating a better lifestyle for everyone.”
What could make a substantial difference in terms of banks’ impact on the community is a combination of collaboration and leadership, said Taylor. He supports the idea of banks leading the charge on the creation of a comprehensive redevelopment and reinvestment plan for the East Side, and then investing accordingly and collaboratively through their charitable foundations.
“All of them have these foundations,” Taylor said. “You can either spend that money in a strategic and intentional way designed to develop a community for the existing population, or you can spend that money alone in piecemeal, siloed, sectorial fashion that will look good on an annual report, but won’t generate transformational and generational changes inside a community.”
Banks might be incentivized to work together because it could mean two things for them, according to Taylor: First, they’d have an opportunity to spend money in a way that would have maximum impact on the East Side, and second, if done right, the city and the banks could become a model of the way to create high levels of diversity, equity and inclusion in an urban area.
“If you prove how to do that, all that does is open up other markets of consumption all over the country because people want to figure out how to do that same thing,” Taylor said.
Some of that is already happening, at least on a bank-by-bank case, said KeyBank’s Owunwanne. Through the KeyBank Foundation, the company is able to leverage different relationships that connect nonprofits to other entities and corporations that can provide help.
“I see this as an opportunity for us to make not just incremental changes, but monumental changes … as part of a larger group,” Owunwanne said “Again, I say that not to absolve the bank of any responsibility, but just as a larger group.”
Downstairs from Parker’s office, Golden Cup Coffee, a roastery and cafe run by a husband and wife team, and some other Jefferson Avenue businesses are trying to build up a business association for existing and potential Jefferson-area businesses. Parker imagined what the group could accomplish if one of the banks could provide someone on a part-time basis to facilitate conversations, provide administrative support and coordinate marketing efforts.
“In the grand scheme of things, when we’re talking about a multimillion dollar [bank], a part-time employee specifically dedicated to relationship-building and building out coalitions, it sounds like a small thing,” Parker said. “But that’s transformational.”
This is a guest post by Mehdi, author of StrongLifts.com. If you enjoy this post, check out his site.
Eating healthy is important.
Eating healthy:
Lowers disease risks
Increases productivity
Gives you more energy
Makes you stronger
You probably think eating healthy is expensive. I’ll be honest — it is. But there are tricks to spare your savings account and keep it low cost. Here are sixteen ways to eat more healthy while keeping it cheap.
What is Healthy Food? Before we start, let’s define healthy food. It consists of:
Protein. The building blocks of muscles, needed for strength.
Fat. A balanced intake of omega 3, 6 & 9.
Veggies. All kinds, especially green fibrous veggies.
Fruit. Full of vitamins.
Water. 1 liter per 1000 calories you expend.
Whole grain food. Oats, rice, pasta, breads, …
On with the tips.
1. Switch to Water. I drank huge amounts of soda daily for more than 15 years. Then I started Strength Training and switched to water:
It’s healthier
It’s cheaper
Quit the soda & drink water. Take a bottle wherever you go.
2. Consume Tap Water. Check the price of water on your tap water bill. Now check the price of bottled water. Quit a difference, isn’t it? So why are you buying bottled water?
Cleaner? Not necessarily.
Better taste? No, simply a matter of Adaptation.
Bottled water companies get their supply from the same source you do: municipal water systems. It’s like selling ice to Eskimos. If you don’t trust the quality of tap water, filter it yourself. I use a Brita Pitcher. One $7 filter cleans 40 gallons water.
3. Eat Eggs. I always have eggs at breakfast:
Full of vitamins
High in proteins
Low in price
Don’t believe the Eggs & Cholesterol myth. Dietary cholesterol is not bound to blood cholesterol. Want to make it cheaper? Buy a chicken.
4. Eat Fatty Meats. Fatty meats are cheaper & more tasty than lean meats. You think it’s not healthy? Check the Fat Myths:
Fat doesn’t make you fat, excess calories do
You need a balanced intake of fats: omega 3, 6 & 9
I’m on the Anabolic Diet, I buy beef chuck instead of sirloin.
5. Get Whey. The cheapest source of protein. 70$ for a 10lbs bag lasting 4 months. Nothing beats that. Use whey in your Post Workout Shake to help recovery.
6. Tuna Cans. Canned tuna is cheap & contains as much protein as meat. Alternate tuna with eggs, meat & whey. You’ll easily get to your daily amount of protein.
7. Buy Frozen Veggies. I mostly buy frozen veggies:
Take less time to prepare
You don’t waste money if not eaten in time
Can be bought in bulk for discounts & stored in your freezer
If you can afford fresh veggies, then do it. I go frozen.
8. Use a Multivitamin. Pesticides lower the vitamin levels of your fruits & veggies. Two solutions:
Buy organic food. Expensive.
Use a multivitamin. $10 a month.
Choose what fits your wallet best. I take the multivitamin.
9. Fish Oil. Omega-3 is found in fish oil. Benefits of omega-3 consumption include:
Lowered cholesterol levels
Decreased body fat
Reduced inflammation
You need to eat fatty fish 3 times a week to get these benefits. Time consuming & expensive, I know. Try Carlson‘s Liquid Fish Oil with Lemon flavor. One teaspoon daily. You’ll be ok.
10. Buy Generic Food. The box might be less attractive, it’s certainly more attractive to your wallet. Brand-name food will always be more expensive. You’re paying for the name. Get real. Food is food. Go generic.
11. Buy in Bulk. Think long-term. Buying in bulk is more expensive at the cashier, but cheaper in the long run:
Gets you discounts
Saves time
Saves car fuel
Invest in a big freezer. Buy meats & veggies in bulk and freeze them.
12. Go to One Grocery Store. This grocery store is cheaper for meat, that grocery store is cheaper for veggies, the other grocery store is cheaper for fish… How many grocery stores are you going to, trying to find the cheapest food? Think!
Time is money. Stop losing a day shopping.
Cars don’t run on water. Lower your fuel expenses.
I get all my food in a big grocery store near my place. It hasn’t the cheapest price for all foods, but it saves me time & fuel.
13. Make a Plan. A classic, but worth repeating. Everything starts with a plan.
Make a list of what you need
Eat a solid meal, don’t go hungry
Go the grocery, get what’s on your list & get out
No need to take your partner or kids with you. This is not a recreational activity. Just get your food & get back home.
14. Take Food To Work. Ever counted how much money you throw away buying food at work daily? Start preparing your food for the day on waking up:
Get up earlier
Eat a solid breakfast (like Scrambled Eggs)
Prepare your food for work in the meanwhile
Total time 30 minutes. No stress during the day about what you’ll be eating & you get healthy food while sparing money.
15. Eat Less. This one is obvious. The less you eat, the lower your grocery bill. If you’re overweight, get on a diet. Your health & bank account will thank you.
16. Don’t Buy Junk Food. The last one. Stop buying anything that comes out of a box, it’s:
Unhealthy
Expensive
If you actually find junk food that is cheaper than whole food, think long-term. Health implications.
Mehdi is author of StrongLifts.com , a blog about Strength Training, nutrition, lifestyle & attitude. His articles include the Anabolic Diet & the Beginner Strength Training Program. Join him at StrongLifts.com for the fascinating journey toward more strength, bigger muscles, low body fat & a better health.
Whether you found a billing error on your credit card statement, suspect a fraudulent charge or simply aren’t satisfied with a product you purchased, the Fair Credit Billing Act of 1974 (FCBA) gives cardholders recourse to dispute charges and get their money back. But that grace period comes with a time limit, as disputes must be submitted in writing no later than 60 days after your credit card statement is issued.
Here’s what you need to know about the FCBA, including credit card dispute time limits, valid reasons for filing a dispute and how long credit card disputes take once they are filed.
Understand your legal rights
The ability to dispute false charges isn’t just a courtesy extended by credit card issuers; it’s a legal right protected by the FCBA. In accordance with that federal law, you have 60 days from the date your credit card statement is issued to dispute a billing error. To comply with this policy, your dispute must be submitted in writing.
🤓Nerdy Tip
The legal minimum time frame for filing a dispute is 60 days, but some credit card processors allow for a longer window. For example, Visa, Mastercard and American Express each allow chargeback requests up to 120 days from the date of the transaction in certain cases. If it’s been longer than 60 days, check with your issuer directly to determine whether you can still file a dispute.
Once you’ve filed your dispute, the FCBA provides that the credit card issuer must acknowledge receipt of your dispute and launch an investigation within 30 days. From there, it has 90 days to either resolve the dispute with a credit to your account or provide a written explanation of why the charges stand.
Before you dispute a credit card charge
Although all cardholders have the legal right to dispute unfair credit card charges, the process can be complicated, so it’s best to make sure your dispute is valid before filing it.
🤓Nerdy Tip
Disputes can’t be filed on pending charges, so if you see a suspicious transaction, you’ll have to wait until it has fully processed. Note that pending transactions can sometimes be caused by credit card holds, meaning they don’t match the final amount that will be charged.
To save yourself from unnecessary paperwork, take these steps before you follow through with initiating a dispute:
Run a search on the name of the company. Some companies operate under multiple names, using one name for customer-facing purposes and a different one for operations and logistics. If you see a transaction from a company name you don’t recognize, a quick online search may help you realize what the charge is.
Check your email, past statements and other payment records. Do you have a free trial or subscription that you forgot to cancel? Or do you have recurring but infrequent charges, like an annual bill? If you take a few minutes to check through your email for order confirmations and review past credit card statements, that will help ensure this isn’t a charge you simply forgot about.
Talk to authorized users to see if they recognize the charge. If your spouse, child, employee or anyone else is an authorized user on your credit card or has access to use the card, they may be the source of the unrecognized transaction.
Contact the merchant directly. If you’re certain there was a billing error — or alternatively, if you’re simply not satisfied with a product you purchased — contact the merchant directly. Explain the issue with the transaction and request a chargeback. If the chargeback is approved, the transaction will be reversed and funds will be returned. And even if the merchant is uncooperative, that documentation will help speed up the investigation once your dispute is filed.
Put your dispute in writing
Although it may make sense to initiate a credit card dispute online or by phone, full compliance with the FCBA requires that you follow up that initial contact in writing within that 60-day window. This ensures that both you and your credit card issuer have record of the dispute and that an investigation can be conducted with accurate information.
🤓Nerdy Tip
Many major issuers offer options to dispute a charge in writing from your online account. Simply go to your account activity, select the charge in question and look for a link that says “report a problem,” “dispute charge” or similar. Then follow the prompts to complete your written dispute.
Your written dispute should include your name and account number, the date you’re filing the dispute, the date of the transaction in question and an explanation of why you’re disputing the transaction. If you’re dissatisfied with the quality of a product and have already reached out to the merchant, include that information as well. And make sure to include copies of any supporting documentation.
Having to file a claim against an insurance policy can be stressful. Whether it’s your homeowners insurance, car insurance, or health insurance, filing a claim means that something went wrong.
You hope that your claim will be handled quickly and professionally and you’ll get the desired outcome, compensation related to your claim. When our area was hit by an inland hurricane a few years back, our house took on a lot of damage. Our entire area was hit, so we made sure to call our insurance company immediately to make sure we were first on the list. Luckily, our insurance company was quick to respond and we got everything taken care of promptly.
Note: You can see my post on the storm that hit our area: How to be Ready for an Emergency.
However, sometimes things go wrong and your agent or insurance agency mishandles your claim or you don’t get the fair result you expected. In this case you don’t have to just settle for what you get, you can report a bad insurance agent or agency through a claim with your state.
The first step when you get a decision that you don’t agree with is to try to negotiate a better settlement amount or claim amount with the agent. If you can reach a satisfactory agreement that is often better then the time and energy that will be invested in filing a claim against the agent. However, if your case was just handled poorly or you just can’t reach an agreement, then filing a claim with the state is necessary.
Where to Start
Search the state department of insurance website to locate the name and address of who to contact in your state. Some states like NY and CT have consumer complaint forms available for you to use in conjunction with their formal insurance department claim center. You can print and complete these forms to get started. If your state doesn’t have forms available online, you can print one from a state that does and use it as a template for your complaint.
If you are having trouble figuring out who to contact in your state you can look up the National Association of Insurance Commissioners and their site will direct you to the appropriate contact in your state.
Filing the Claim
You will want to complete the claim against your agent thoroughly and accurately. This means thinking with a clear head and detailing facts only. It is important to list all events and contacts in chronological order. Include any contact you had with the agent, police, insurance company, doctors or anyone pertinent to your case.
Attach any necessary documents. This could be health records in terms of a health care claim or an accident report if it was a vehicle claim. It’s important to hold on to the original documents and just send in photo copies in case they get misplaced and you need to furnish additional copies.
Remember to sign and date your claim before you send it in. Then you will want to send it to your state department of insurance claims.
Follow Up
If you want to achieve satisfactory results, it is important to follow up. Usually two weeks after you submit your claim is sufficient time for follow up. Keep following up ever week until your claim is handled.
Follow Up, Follow Up
A friend of mine who is industry read my post and wanted to add their two cents. I thought it was a good perspective, so I wanted to share…..
Saw you post a few days ago about insurance claims. Being in the business, it struck a chord with me. I could ramble on with many things but a few that stuck out to me about your article/post/whatever was that it assumed everyone who has an issue with the way their claim is handled had a covered loss? Admittedly, I didn’t research the context of your article but am assuming you’re trying to educate the public. Just wanted to ensure that it was objective! Naturally, email/written text doesn’t allow me to provide non-verbals and context to this message. It is all in good fun and nothing that I am losing any sleep over – or you either for that matter. Just some food for thought.
If you didn’t receive remarkable customer service or were denied coverage for a covered loss, then there are grounds to file complaints. If the top insurance companies mess up, although I know that with respect to the people I work with and what I believe in my company, it isn’t malicious. More so, human error or misinterpretations. I wouldn’t bat an eye to file a complaint myself as a consumer if I thought I was treated unjustly or unfairly, especially when I’ve entered into a contract. But, if you expect insurance to cover general maintenance on your property when your roofer uncovered rotted roof decking once they take hail damaged shingles off your roof – there may not be anything a judge or the department of insurance can do to help you – maintenance isn’t covered. Also, there are areas in most insurance policies that outline alternative dispute resolutions – be it appraisal, arbitration, or filing suit. Often times, these are measures sought outside of asking the DOI to step in which is often viewed as the final option when others didn’t suffice (I think often times the DOI would agree).
One other thing I thought was interesting was that you filed your claim quickly to get to the top of the list. Certainly can’t speak for all insurance companies, but can say based on my experience, this is a general misconception. Most companies assign claims based on severity. The people with more damage generally get inspected first. But there are a lot of subjective items that go into it as well – namely the schedule/location of the assigned adjuster. There are other factors but but just because you file a claim quickly doesn’t mean you’re going to get inspected quicker – relatively speaking.
Anyway, that is my 2 cents – or a quarter based on the amount I’ve typed out here! I just sort of felt like reading it, that you were maybe supporting filing a compliant when you didn’t get what you thought you deserved when the general concept of insurance is confusing for many. I am by no means saying all insurance companies have unwavering ethics or morals. Since USAA is giving you some props – check out there article about myths in insurance. They list some common ones that any insurance company would agree are out there. Wow – I thought this would be a few sentences and this turned into a book. Now I need to go back and read it again and make sure I’ve covered everything! Anyway, I seriously wanted to more so give you props for what you’re doing and jab at you a little and this turned heavy on the jab (in good fun) and less on the props.
Have you had a bad experience with an insurance agent? If so, share your experience in the comments below.
When it comes to home decor, it takes a certain level of assuredness to commit to color. Whether it is painting your walls green or investing in a bright blue couch, staying safe seems like the only option with neutrals like grays, beiges, and greiges.
But anyone can gain confidence designing their own space by adding low-stakes, vibrant touches in noncommittal ways. Here, five experts offer their best tips to brighten up your living room—each impermanent and cost-effective—sure to leave you inspired. Once you’ve got an idea in mind, head over to homedepot.com/decor to shop top trends and brands, and find your personalized pops of color.
1. Vibrant Rugs
“Look down on the ground. All you need is a new rug and voila, your space is totally transformed,” says Brad Ramsey, principal designer and founder of his own studio in Nashville. “Rugs can provide a room with texture, pattern, or color—and sometimes all three in one. Depending on your style, you can go for modern patterns, saturated solids, soft organic textures, or muted antiques to change the feel of your home.”
BALTA, Merril Pink Geometric Area Rug
BALTA, Levine Burnt Orange Geometric Shag Area Rug
Rug Branch, Savannah Collection Modern Geometric Area Rug
2. Contrasting Textures and Elements
“Think of your upholstery like good basics in your wardrobe: You can always layer underneath or on top of those base pieces—and change the feel of a space without a substantial renovation,” says Ramsey.
For example: If you have a leather or velvet couch, opt for an oversized natural jute or sisal rug that takes up the majority of the space. Then, add a brighter and smaller rug over top. “Scale the colorful rug to ground the seating area and then let the natural rug provide more texture,” he adds. “Then you can contrast and accessorize with fun art and metal accents.”
David Tsay
3. Powerful Pillows
All of our experts could agree on this: Never underestimate the power of pillows. “I love to add a color accent to a room with throw pillows. But don’t settle for two of the exact same,” says Ramsey. “Instead opt for a collection of coordinating pillows.”
If you want to revitalize your oatmeal or charcoal sofa, “selecting a fun, colorful print fabric for pillows will bring it back to life,” says Susan Spath, principal designer of Kern & Co in San Diego.
Mina Victory, Coral Abstract Rectangle Throw Pillow
New Heights, Augustine Slope Arm Linen Blend Sofa
LR Home, Pom Pom Textured Decorative Throw Pillow
4. Lively Curtains and Blinds
“What will give you the biggest bang for your buck are colorful drapes,” says Mimi Meacham, founder and principal designer of Marian Louise Designs. “Frame your windows with a fun, colorful print, or choose a solid color fabric with a chic trim.” Meacham prefers darker, heavier tones paired with velvet and wool textures, which “add a soft, yet impactful statement to the space.” If you prefer something more open, linen or sheer fabrics can create a light and airy feel.
5. Natural Accents
“A natural way to liven up any room is to incorporate plants,” says Ramsey. “If you get great light, try a fiddle-leaf fig tree in the window. They love to sunbathe and cast gorgeous shadows from their large, waxy leaves.” Colorful planters can also infuse a joyful atmosphere in any space. In an area where sunlight isn’t abundant, try something lower maintenance, like a snake plant, or add dried or faux flowers to empty shelves, bookcases, stairwells, and entryways.
Litton Lane, Yellow Metal Modern Planter
Pure Garden, Artificial Fiddle Leaf Fig Tree
CosmoLiving, Blue Metal Geometric Vase
6. Subtle Lamps and Lights
Whether you’re adding decorative lighting over a piece of artwork or a stand-alone lamp for added ambiance, seize the opportunity to shake things up. “A lamp or sconce with a white lampshade is boring,” says Meacham. “Invest in some fun, colorful lampshades” that project their hues around the room.
7. Bold Bookcases
Adding wallpaper to built-in or freestanding bookcases “will add depth, layering and interest to the living room. Plus, it’s much simpler and a more minimal investment than covering your walls,” says Mindy O’Connor of Melinda Kelson O’Connor Architecture & Interiors in Philadelphia.
Alternatively, add a coat of fresh paint to your shelves. “If your living room is mostly neutral, changing the color of your customized built-in or freestanding shelves to a darker tone, such as navy, black, chocolate brown, or forest green creates a striking visual contrast against white walls,” says the principal designer at Miss Alice Designs, Alice Chiu. “Your eye will be drawn to the visual weight of the contrast, which presents a nice focal point.”
David Tsay
8. Refreshed Knickknacks
Ramsey recommends swapping outdated tchotchkes for items that feel more current. “We can get stuck with the same decorative items in our homes for years out of fear that it’s wasteful to discard them. But I say donate those items and look for new ones that speak to you! Would you wear the same shoes for 10 years and expect to still like them? In most cases, no! So don’t treat your decor like it’s too precious,” he says. “As styles and trends change, you can update along with them.”
Teal Elephant Book Ends, Carved Gorara Soapstone
“Enclosed Circles” by Marmont Hill Framed Abstract Art Print
A & B Home, Effra Rectangular Blue Trays
Feeling inspired? Find colorful accents for your home at homedepot.com/decor.
Photographer: David Tsay; Art Direction and Production: Armine Altiparmakian and Sabrina Contratti; Prop Stylist: Olga Grigorenko; Merch Team: Two Coast Productions; Local Production: Right Arm Productions
The 21 top recipients of TARP funds saw minimal increases in overall lending in February compared to a month earlier, according to data released today by the Treasury Department.
The median growth in total lending was actually negative two percent in February, with nine banks posting increases and 12 experiencing declines.
“Against a difficult economic backdrop, banks extended approximately the same level of loan originations in February as in January,” the Treasury said in a release.
“The relatively steady overall lending levels observed in February likely would have been lower absent the capital provided by Treasury through the CPP, an indication of the critical role this program has played in stabilizing markets and restoring the flow of credit to consumers and business.”
However, residential mortgage originations across the 21 banks increased by a median 35 percent, thanks to a flurry of refinance activity.
The median change in mortgage refinancing during the month was an increase of 42 percent from January, thanks in part to record low rates; home equity loan originations saw a median increase of 18 percent.
Wells Fargo was the top mortgage lender for the second month running with $34.8 billion in monthly loan originations, trailed by Bank of America with $28.6 billion and Chase with $13 billion, all substantial increases from January.
Meanwhile, loan originations for consumer loans, such as auto, student, and personal loans, decreased a median 47 percent, partially attributable to poor demand in these industries.
New credit card originations also slowed by a median three percent, while the average loan balance of credit accounts fell by a median one percent.
It appears as if the banks that received billions in TARP funds are only willing to originate low-risk, government-backed mortgages (FHA loans, VA loans), while cutting back on all other types of credit.
The latest survey from the National Association of Realtors revealed some troubling news in the housing market.
The share of first-time home buyers reached its lowest point in nearly 30 years, per the 2014 National Association of Realtors® Profile of Home Buyers and Sellers.
The average, dating back to 1981, shows that roughly four of 10 home purchases are made by first-time buyers.
This year, that number is closer to a third (33%), down from 38% a year ago and not far from the all-time low of 30% in 1987.
Lots of Roadblocks
NAR chief economist Lawrence Yun pointed to the many roadblocks hindering the young from purchasing real estate these days.
One issue seems to be limited job prospects and/or stagnant income growth. Meanwhile, rents are rising and student loans are becoming more of a burden for college-educated individuals who would typically be the ones buying homes.
That means it’s difficult to raise enough money for a down payment, especially with all-cash buyers swooping in and buying up all the cheap properties nowadays.
There’s also talk of tight credit conditions and low housing inventory, which don’t appear to be improving.
Unfortunately, this hurts the housing ecosystem, which relies on young families to come in and buy lower-end properties from existing homeowners who then purchase move-up properties.
One could also argue that home prices have become too expensive again, even with mortgage rates as low as they are.
31 Still the Median Age of a First-Timer
Despite the decline in first-time buyers, the median age was still 31, unchanged from the previous two years.
And the median income of first-timers was $68,300, pretty darn close to the $67,400 reported in 2013. A 1,570 square-foot home was the norm purchase, with a price tag of $169,000.
Compare this to the typical repeat buyer who was 53 years old, earned $95,000, and purchased a median 2,030-square foot home costing $240,000.
As you might expect, the large majority (88%) of first-time buyers financed their home purchases, and the median down payment was a low six percent.
Aside from tapping their own savings, 26% of first-timers received a gift from a friend or relative, while six percent received a loan from a relative/friend.
Another 10% were forced to sell stocks or bonds or tap into their 401(k) to get the necessary funds to buy a home.
Repeat buyers were able to put down a median 13% down payment thanks to their existing home equity.
Fixed Mortgages Still King
The overwhelming loan choice for entry-level buyers continues to be a fixed-rate mortgage, with 93% preferring fixed over ARM.
That’s generally a good move because first-time buyers plan to stay in their homes for 10 years, while repeat buyers plan to hold onto their properties for 15 years.
Additionally, 35% of first-timers financed their home purchase with an FHA mortgage, though that number is down from 39% in 2013 and 56% in 2010 thanks to higher mortgage insurance premiums.
As for why they chose to buy a home, 53% of noobs cited the desire to own a home of their own. The American Dream.
Repeat buyers had a variety of reasons to buy again, with 12% experiencing a job-related move, 11% wanting a home in a better area, and 10% opting for a larger home.
The composition of buyers was pretty much unchanged from a year ago, with 65% married couples, 16% single women, nine percent single men, and eight percent unmarried couples.
Read more: Advantages of buying instead of renting.
The term “gross spread” refers to an important element of the initial public offering (IPO) process: Gross spread is the money underwriters earn for their role in taking a company public.
When a company IPOs, or “goes public,” it releases its shares onto a public stock exchange, an undertaking that demands a tremendous amount of work behind the scenes. That work involves bankers, analysts, underwriters, and numerous others. All of that work must be compensated, which is where the gross spread — also called the underwriting spread — comes into play.
How Gross Spread Works
The gross spread refers to the cut of the money that is paid to the underwriters for their role in taking a company public. In effect, it’s sort of like a commission paid to the IPO underwriting team. But the underwriting spread isn’t a flat fee, but a spread in the sense that it represents a share price differential.
Underwriters
Underwriters are common players in many facets of the financial industry. It’s common to find underwriters working on mortgages, as well as insurance policies.
When it comes to IPOs, underwriters or underwriting firms work with a private company to take them public, acting as risk-assessors, effectively, in exchange for the underwriters spread. Their job is to evaluate risk and charge a price for doing so.
Recommended: What Is the IPO Process?
The Role of Underwriters in the IPO Process
These IPO underwriters generally work for an investment bank and shepherd the company through the IPO process, ensuring that the company covers all of its regulatory bases.
The underwriters also reach out to a swath of investors to gauge interest in a company’s forthcoming IPO, and use the feedback they receive to set an IPO price — this is a key part of the process of determining the valuation of an IPO.
In order to generate compensation for all this work, the underwriters typically buy an entire IPO issue and resell the shares, keeping the profits for themselves. So, the underwriters set the IPO price, buy the shares, and — assuming the shares increase in value once they become publicly available — the underwriters generate a profit from reselling them, the same way you would selling the shares of an ordinary stock that had risen in value.
For companies that are going public, the benefit is that they’re essentially guaranteed to raise money from the IPO by selling the shares to the underwriters. The underwriters then sell the shares to buyers they have lined up at a higher price in order to turn a profit. That difference in price (and profit) is the gross spread.
For the mathematically minded, the gross spread — basically the IPO underwriting fee — would be equal to the sale price of the shares sold by the underwriter, minus the price of the shares it paid for the shares. 💡Quick Tip: Keen to invest in an initial public offering, or IPO? Be sure to check with your brokerage about what’s required. Typically IPO stock is available only to eligible investors.
Gross Spread & Underwriting Costs
The gross spread, for most IPOs, can range between 2% and 8% of the IPO’s offering price — it depends on the specifics of the IPO. There can be many variables that ultimately dictate what the gross spread ends up being.
The gross spread also comprises a few different components, which are divided up by members of the underwriter group or firm: The management fee, underwriting fee, and concession. The underwriters typically split the gross spread, overall, as such: 20% for the management fee, 20% for the underwriting fee, and 60% for the concession. More on each below:
Management fee
The management fee, or manager’s fee, is the amount paid to the leader or manager of the investment bank providing underwriting services. This fee essentially amounts to a commission for managing and facilitating the entire process. It’s also sometimes called a “structuring fee.”
Underwriting fee
The IPO underwriting fee is similar to the management fee in that it is collected by and paid to the underwriters for performing their services. Again, this is more or less a commission that is taken as a percentage of the overall gross spread and divided up by the underwriting teams.
Concession
The concession, or selling concession, is generally the compensation underwriters get for managing the IPO process for a company. So, in this sense, the concession is a part of the gross spread during the IPO process and is, effectively, the profits earned by selling shares when the process is complete. It’s divided up between the underwriters proportionately depending on the number of shares the underwriter sells. 💡Quick Tip: If you’re opening a brokerage account for the first time, consider starting with an amount of money you’re prepared to lose. Investing always includes the risk of loss, and until you’ve gained some experience, it’s probably wise to start small.
Examples of Gross Spread
Here’s an example of how gross spread may look in the real world:
Company X is planning to IPO, and its shares are valued at $30 each. The underwriters working with Company X on its IPO purchase the full slate of shares prior to the IPO, and then go off and sell the shares at $32 each to investors and the general public.
In this case, the gross spread would be equal to the difference between what the underwriters paid Company X for the shares, and what they then sold the shares for to the public — $32 – $30 = $2.
Or, to express it as a ratio, the gross spread is 6.7%. More on the ratio calculation below.
Gross Spread Ratio
As mentioned, the gross spread can be expressed or calculated as a ratio. Using the figures above, we’d be looking to figure out what percentage $2 is (the gross spread) of $30 (the share price sold to the underwriters).
So, to calculate the ratio, you’d simply divide the gross spread by the share price — $2 divided by $30. The calculation would look like this:
$2 ÷ $30 = 0.0666
The figure we get is approximately 6.7%. Also note that the higher the ratio, the more money the underwriters (or investment bank serving as the underwriter) receives at the end of the process.
IPO Investing With SoFi
Though the gross spread, or underwriters spread, is not a well-known aspect of the IPO process, it’s relatively straightforward. Underwriters, who shepherd a company through the IPO process, ultimately buy the initial shares from the company at one price, and sell them to the public at the IPO at a higher price. The spread between the two is considered the gross spread, or the compensation the underwriting team earns for all their work.
Whether you’re curious about exploring IPOs, or interested in traditional stocks and exchange-traded funds (ETFs), you can get started by opening an account on the SoFi Invest® brokerage platform. On SoFi Invest, eligible SoFi members have the opportunity to trade IPO shares, and there are no account minimums for those with an Active Investing account. As with any investment, it’s wise to consider your overall portfolio goals in order to assess whether IPO investing is right for you, given the risks of volatility and loss.
Invest with as little as $5 with a SoFi Active Investing account.
FAQ
What is meant by the underwriting spread?
The underwriting spread is another term for the gross spread. Underwriters pay issuers, or an issuing company, for a company’s shares prior to the IPO. The underwriting firm then turns around and sells shares to investors. The difference (expressed as a dollar amount) that the underwriter pays the issuer and that it receives back from selling the shares during an IPO is the underwriting spread.
What are gross proceeds in an IPO?
Gross proceeds, in relation to an IPO, refers to the total aggregate amount of money raised during the public offering. This is all of the money raised by investors during the IPO.
What is a typical underwriting spread?
As underwriting spreads are usually expressed as dollar amounts, the typical underwriting spread can vary depending on several variables in the IPO process — including share price, share volume, etc. But in general, it can amount to between 3.5% and 7% of gross proceeds during an IPO.
Photo credit: iStock/bankrx
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No matter what we’re planning to spend, whether it’s money or time, we want to make an informed decision so not to have a less than stellar experience. This is where online reviews, whether it’s for a positive experience or a negative review, can make a difference. We rely on feedback from others to help us make decisions. A well-written review of apartments or apartment communities is possibly the reason someone rents an apartment or not.
More than 37 percent of people live in an apartment, according to National Multifamily Housing Association, and reviews can help people decide whether to rent in a particular building or not.
Writing an apartment review isn’t difficult and can improve accessibility for some in your apartment community. Are renters’ rights protected, for example, or are the units safe and up to code? Sometimes, those things get mentioned in a review.
It’s also important to know as you read or evaluate reviews that not all are objective. An apartment’s website is only one piece of information but a great apartment review can share feedback on how management works and the overall strength of an apartment community. Keep reading to learn how to read and write accurate apartment reviews.
How do you evaluate an apartment review?
There are a few telltale signs of great apartment reviews that are helpful. Does the person begin with facts, including when they rented the apartment and details about maintenance issues or amenities on the property? Did the person have issues with others? Did they deal with the office staff, apartment manager or landlord with issues on their properties?
If you see multiple reviews by residents about details within the apartment that don’t work or they focus on specific issues they’re constantly bringing to their landlord, it’s worth noting because it’s more than just one person having a problem with their apartment.
Pay attention to how residents address or discuss what’s mentioned in the apartment reviews. Do they bring it to the attention of the property manager? Does it take five business days or more for management to respond once someone makes contact? Do they request a face-to-face meeting and share the progress of a complaint? Is the review written in complete sentences?
An apartment’s website is only one piece of information but apartment reviews hold so much information.
Be wary of the bad reviews
Also, consider an author’s motive when writing online reviews. Do they resort to bombastic name-calling? Did they write a review about the apartment? Did the author mention the company, apartment community or focus on a specific contact at the company?
Consider who would most benefit from this review. Remember, writing online reviews, whether it’s on a specific site or on a social media page, is free. It’s one thing to get feedback beyond what’s on a website that is helpful but writing a hit piece doesn’t benefit the apartment community as a whole.
How do you evaluate an apartment community?
Many people look at a specific property when searching for a new apartment but it’s a good idea to see how residents rate their apartment community on various sites, too. Those are helpful and are more objective than what a website includes in terms of how people who live in the apartment engage with various amenities and how they feel management handles things.
How do you write a review for an apartment?
When writing reviews to post on various sites, you want to share feedback you feel others would find helpful when deciding whether to rent a place. Apartment communities may matter just as much as individual apartment units so consider a review that covers as much detail as possible.
Polite articulation in any review will garner more appreciation from the reader. Whether you discuss relevant accessibility standards being subpar or share feedback about an issue in progress, those reviews can help the reader better understand what living in this apartment community will look like as a matter of course.
As you would expect to read in a review, post information including when you lived (or if you’re still living) in the apartment and any tips you’ve learned by living there. Is management generally responsive to issues or does the office staff ignore issues? Does the landlord read reviews and makes improvements based on any tips or suggestions that someone takes the time to post? All of these details can help someone make an informed decision about their next address.
How important are apartment online reviews?
A review is only as good as the author but apartment reviews that someone takes the time to write and post with great feedback and tips are very helpful. No one wants to move into a place that might have too many problems or that management ignores — those are the kinds of things that pop up in apartment reviews.
Reading and writing accurate apartment reviews can save you time and money
Writing online apartment reviews doesn’t need to take a lot of time but writing an objective one can help you learn and discuss what you find important when seeking an apartment to rent. Reading and knowing how to evaluate reviews can save you time and money in the long run. A well-written review that highlights key issues is a possible deal breaker, while one that mentions amenities and benefits can seal the deal. It’s worth taking the time to write a good (or bad) review, as well as reading them to help you make the best decision on your next place.
As a Chicago-based freelance writer, Megy Karydes has covered everything from space-aged tomato seeds grown in a Chicago Public School to Chicago Blues musician Lurrie Bell. Her work has been featured in USA Today, Travel + Leisure, Midwest Living magazine and other national and regional media outlets. When she’s not out exploring the city with her two children and husband, she’s perfecting her air hockey technique.