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For Those With Low Incomes, Help Creating a Credit History

Spencer Michels reports on a program that helps low-income people with no credit gain access to loans and financial counseling.

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  • JUDY WOODRUFF:

    Next, getting credit when credit is tight. NewsHour correspondent Spencer Michels has our story.

  • SPENCER MICHELS, NewsHour Correspondent:

    In poor and minority neighborhoods, like New York's Washington Heights, in the shadow of the George Washington Bridge, getting a loan or establishing credit is a real problem, especially in perilous economic times.

    Banks dot the area, but few are willing to cater to the mostly Dominican residents who live here. They are part of the roughly 28 million Americans who have no checking or savings account.

    But you can't buy a business like the New Look Hair Salon without savings or credit. Hairdresser Francia Santiago, who came from the Dominican Republic 18 years ago, knew that firsthand.

  • FRANCIA SANTIAGO (through translator):

    I used to always be denied when I applied for credit, and I didn't know why, because I thought I was fine.

  • SPENCER MICHELS:

    Santiago wanted to own the shop she was working in. And in 1998, she found a neighborhood credit union that showed her the way.

  • FRANCIA SANTIAGO (through translator):

    They helped me plan my budget and taught me how to avoid bouncing checks and how to pay my bills on time.

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