Redbud Financial Alternatives Reaches $1 Million in Affordable Loans in Eastern Kentucky | News
As one of only four Community Development Financial Institutions (CDFIs) in Eastern Kentucky, Redbud Financial Alternatives, Inc. (“Redbud”) recently reached a milestone in its efforts to combat predatory lending in the local community.
Predatory lending is any lending practice that imposes unfair and abusive loan terms on borrowers, including high interest rates, high fees, and terms that deprive the borrower of equity. To date, Redbud has issued over $1 million in Fair and Affordable Consumer Loans in Eastern Kentucky, collectively saving customers over $200,000 in interest and fees. Redbud has also helped over 250 Eastern Kentucky residents with their personal, auto, and debt consolidation loans and the financial education that comes with them.
Redbud, a Certified CDFI headquartered in Hazard, is focused on transforming credit from a barrier to an opportunity for Appalachian families. Redbud’s parent organization is Housing Development Alliance (HDA), a nonprofit affordable housing developer, with nearly 30 years of experience providing housing to low-income families in Eastern Kentucky. HDA founded Redbud after recognizing that many housing seekers struggled with poor credit and few resources to improve their credit.
“Credit is a powerful tool for building a future, but it can be complicated and confusing. At Redbud, we help clients understand the benefits and risks of credit and how they can use it for their own benefit,” said CDFI Director Louis Irvin.
To ensure that a Redbud loan helps rather than hurts customers, Redbud combines personalized financial education with its affordable loan program. Each customer receives a credit report review from Redbud’s loan officer, allowing customers to understand the relationship between their borrowing habits and their ability to access credit.
“All of our loan products are developed in response to community needs. We ask, where is expensive credit hurting those who can least afford it, and how can we help? “said Irvin.
In 2021, Redbud’s average monthly loans have grown from $5,000 to over $80,000, reflecting the added capacity of Redbud’s new loan officer, Gary Brewer, and Redbud’s new car loan product. This growth was made possible by critical pandemic financial support from Opportunity Finance Network and the CDFI Fund Rapid Response Program.
In 2022, Redbud is expanding its financial education efforts in Eastern Kentucky schools through the Junior Achievement program to ensure students meet the Kentucky Financial Empowerment Commission’s metrics. Redbud also plans to make an additional $1 million in fair loans in 2022. Investors interested in being part of this growth are encouraged to contact Redbud for more information.
To learn more about Redbud’s loan and financial education programs, or to learn more about investing in Redbud, visit its website at, redbudloan.org, or call (606) 716-6100. Redbud’s office is in the same building as HDA, which is located at 2871 North Main Street, Hazard.