ShoreBank Blog
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Archive for May, 2009
Tuesday, May 26th, 2009
It is official – summer is here! Memorial Day may have felt early this year since we still have a week of May left, but the vacation season is now underway. Whether you are traveling for food, folks, or fun, there is likely a lower carbon way of getting there.
You might guess that the answer is simple. But the Union of Concerned Scientists created a guide to the lowest carbon ways to travel. They looked at three different factors: how far you were going, what the vehicle was, and, the kicker for me, and how many people were traveling with you? It turns out that their research had some surprises.
One big surprise was how important it was to incorporate the size of your travel group when you plan your travels. Overall the lowest carbon emission choice is to travel by motor coach – but the second best choice just might be to fly economy. If your party has two people and you are traveling 1,000 miles then flying economy beats out driving – the flight creates 835 pounds of CO2 while driving would create 1,125 pounds of CO2. It even beats out taking the train which comes in at 860 pounds of CO2.
But the Union is serious when they stated ‘economy.’ A vacation splurge can offset an entire year of environmental conservation actions. One wild example was the carbon impact of a family of four taking a vacation. In the Union’s example, the family used frequent flyer miles to fly first class, for free, with their kids from Chicago to Disney World. First class – sounds great! But not for the environment. It turns out a first class seat takes up twice the space of an economy seat causing twice as many emissions. This single flight created 1.5x more carbon emissions than all of the family’s daily commuting for the year. And they commuted about 35 miles a day in non-hybrid cars! What an eye opener.
The Union even created a table to help you plot the most eco-friendly way to enjoy your summer vacation.
So if you are traveling beyond a walk-able distance this summer give the report a look – it has lots of tips on how to get where you are going.
http://www.ucsusa.org/clean_vehicles/solutions/cleaner_cars_pickups_and_suvs/greentravel/getting-there-greener.html
And low happy carbon travels!
Tags: community development, energy efficiency, environmental sustainability, green banking, green transportation, ShoreBank, triple bottom line
Posted in Outreach | 2 Comments »
Wednesday, May 20th, 2009
With interest rates on 15- and 30-year mortgages, either near or at historic low levels, now might be the ideal time to explore refinancing your home’s mortgage. However, regardless of the interest-rate, the current mortgage crisis has taught homeowners that understanding their home loan and the process of obtaining a mortgage is vital for ensuring sustainable homeownership.
However, refinancing comes at a cost. For instance, closing fees on a new mortgage can average 3% of the total loan or $3,000 on a $100,000 loan. Closing costs include title policy, appraisal fees, and reestablishment of escrow accounts. So before you refinance, I suggest looking at some characteristics of homeowners to help you determine whether getting a new loan makes good economic sense, or are you better off with your current loan.
I suggest refinancing if you align with the following characteristics:
• Your mortgage’s interest rate is significantly higher than the market’s interest rates.
• You are planning to continue living in your current home for at least several years which will help recoup closing costs over the life of the loan.
• You have an adjustable rate mortgage that is due to reset, reaching a rate significantly higher than the market-rate.
• You have an adjustable rate due to reset and would like to lock-in, a secure and competitive fixed-rate.
• You have a decent amount of equity in your home, about 20% or more. You may be able to refinance even if your home is now worth about the same as your loan value or even a little less; check www.makinghomeaffordable.gov for details refinancing loans that are 105% or less of their property values.
• You have money to use for closing costs. Typically you can obtain a more favorable rate if you have money available up-front as opposed to bundling it into the new mortgage.
On the other side of the coin, it may not pay to refinance if you fall into one or more of the following groups:
• You already have a pretty low interest, 5% or lower, and recovering closing costs is nearly impossible.
• You are planning on moving which makes recovering closing costs nearly impossible too.
• 
You have an adjustable rate mortgage at a pretty good rate and you are planning to move in the next year or two.
• The reassessment of you property is part of the refinancing process and it may force you to pay private mortgage insurance (PMI). You will be charged PMI* when your loan is more than 80% of the current value of the home (*Fannie Mae and Freddie Mac sold loans are eligible under the new Refi Plus program)
• Keep in mind that you are reducing the principal balance on your mortgage, from the very first mortgage payment. Therefore when it’s affordable, consider refinancing for a shorter term. This will prevent you from extending the term of the loan.
• You don’t have the money for closing cost and the interest rate you have to settle for is too high.
And finally, too many homeowners have been struggling to pay not only the mortgage but also other bills, due to a loss of income or perhaps an unexpected expense. As a result, their credit quality has taken a good hit since they obtained their mortgage.
However, for these homeowners who are saddled with a high interest rate, may still qualify for a loan modification or refinance at ShoreBank or other community banks who engage in character lending and rely on the borrower’s payment history, instead of the credit score, in qualifying for refinance loans. It’s worth the effort to obtain lower payments and build equity.
The Making Home Affordable modification program will provide payment relief and prevent foreclosures and is available through your current lender.
Tags: community development, green banking, home ownership, Making Home Affordable modification program, refinacing, ShoreBank, triple bottom line
Posted in Mortgage Lending | 2 Comments »
Friday, May 15th, 2009
We are excited to sponsor Chicago Green Festival this weekend, May 16-17 at Navy Pier. Green Festival is a fabulous opportunity for ShoreBank to illustrate to others that by integrating economic development and environmental sustainability we can build stronger, healthier communities. Amidst the backdrop of current economic conditions, this education has perhaps never been more important.
Green Festival is the largest environmental sustainability event in the world. It attracts tens of thousands of individuals interested in “green” living. Festival visitors can participate in green career workshops, kids activities, sample organic refreshments, and enjoy live music while gaining a better understanding and appreciation for the 350 small green businesses from across the country that are creating healthier individuals and helping to build strong, sustainable communities.
But, living a more sustainable, green lifestyle takes place in the community, one person at a time. That is why social media has such great potential to reach more people and make positive impressions. So, to celebrate Green Festival 2009, ShoreBank will plant a tree for every new person who becomes a ShoreBank Facebook Fan Page fan this weekend!
But we need your help. Please show your support for ShoreBank’s mission and help protect the environment by sharing our Fan Page at http://www.facebook.com/pages/ShoreBank/21702975841 with all of your friends and family. Green Festival might be in Chicago but environmental sustainability knows no boundaries.
If you are in Chicago, please come to Green Festival, compliments of ShoreBank. Find your free Green Festival admission coupon here. Please stop by our booth at #5000 and say hello! We look forward to meeting you and all of our new Facebook fans!
Tags: community development, green banking, Green Festival, ShoreBank, social media, triple bottom line
Posted in Community | 1 Comment »
Tuesday, May 12th, 2009
Even reaching the low hanging fruit often requires a ladder
Every year, as part of our Earth Day events, ShoreBank hosts a seminar for nonprofits about the opportunities available to reduce energy usage in their facilities and incentives available from utilities and foundation to complete the energy efficiency retrofits. As part of this year’s event, we asked representatives from ComEd, our local electrical utility, to complete an energy audit of a nonprofit facility. ComEd graciously agreed and presented the findings at the event.
The results were typical of our nonprofit customers – lots of low cost opportunities, such as changing bulbs/ballasts to more efficient varieties, switching to LED exit signs, and adding sensors for irregularly used spaces, such as meeting rooms and bathrooms. The identified measures included replacing inefficient lighting in a building that was built less than 3 years ago. In total, the costs of the measures was less than $40,000, with a pay-back estimated under 3 ½ years.
The reaction to the findings was also typical. The CFO was against spending the funds, especially to replace lighting that was only a few years old, irrespective of the large incentives offered by the utility and the quick pay-back on the measures.
Fortunately, the story doesn’t end there. Thanks to a recoverable grant from the Federal Home Loan Bank of Chicago, ShoreBank is able to offer very low-cost loan to cover these upfront cost. With this low cost funding, and an Executive Director committed to making the improvements, the retrofit is moving forward.
The story is instructive for a couple of reasons. For one, it demonstrates the importance of intermediaries such as ShoreBank. ShoreBank was instrumental in connecting the facility owner to the resources needed to understand the options available. In this case, we discovered that for-profits in Illinois are eligible for free energy audits, while nonprofits are not. So, without our focus on this sector, a whole set of owners, who maintain a large number of older buildings, would fall outside of the established programs.
Secondly, the example illustrates the importance of capitalizing loan funds focused on energy efficiency retrofits. In this case, the risk is very limited – it is a small loan to a large and well established nonprofit. But the perceived risks are high – since the loan is collateralized only by the lighting equipment and the nonprofit is dependent upon state grants, at a time where the state faces a massive budget deficit. By utilizing the funding from the Federal Home Loan Bank, we could offer terms that allowed the project to move forward. We see this financing piece as a critical mechanism to providing a ladder to pick the low hanging fruit.
Tags: community development, energy conservation loans, energy efficiency, green banking, ShoreBank, triple bottom line
Posted in Green Collar | 1 Comment »
Tuesday, May 5th, 2009
Memorial Day, 1937. Chicago. Several thousand striking steelworkers and their families gather in a field near the Republic Steel plant to obtain recognition for their union. Singing “Solidarity forever! The union makes us strong!” and carrying banners, they approach the plant. But between the men, their families, and Republic Steel stand 500 Chicago policemen. The police move forward, first swinging their nightsticks and then firing tear gas grenades and guns shouting “you got no rights.” Within a few minutes seven workers are dead and more than one hundred seriously hurt. The event has come down through Labor history as the Memorial Day Massacre.
May 1, 2009, a day celebrated in many countries as International Workers’ Day in honor of the achievements of Organized Labor. New York City. The United Automobile Workers, representing Chrysler’s unionized workers, agrees to a bankruptcy that would effectively give it a 55% ownership stake in the company. The UAW’s contract is preserved through the bankruptcy, meaning it will not have to renegotiate its lucrative salaries and benefits with Fiat, the Italian automobile manufacturer that will operate the new Chrysler.
Of course, the deal will be worth nothing if Chrysler goes down, a very real possibility. New, Fiat-designed Chryslers will not be roll off the assembly lines for two years or more, and Fiat, in the past, has had no success in cracking the American market. Not that Chrysler has had much success lately. Its U.S. deliveries in April dropped to 76,682 units, down 48% from a year ago and 60% less than in April 2007. Chrysler isn’t alone; total U.S. auto sales fell in April, for the 18th consecutive month to just 819,540 units. But, at 9.4% of U.S. sales, Chrysler is behind GM, Ford, Toyota, and Honda.
Organized labor, still oppressed in 1937, reached its zenith in the 1950s and 60s, when America’s industrial might was unchallenged. The notion that one of the Big Three automakers could fail would have been preposterous. Labor flexed its muscles, wringing ever-greater concessions from Capital. But the world turned, and now, at least at Chrysler, Labor is Capital.
Tags: community development, economic predictors, green banking, ShoreBank, triple bottom line
Posted in Banking Industry | No Comments »
