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Federal leaders stop in Saint Paul to announce action on predatory home lending
The head of the Consumer Financial Protection Bureau visited the Twin Cities for a hearing on “contracts for deed,” which he said targets immigrant communities.
ST PAUL, Minn. — The head of the Consumer Financial Protection Bureau (CFPB) made a stop in Saint Paul on Tuesday for a field hearing on predatory home lending practices involving “contracts for deed,” which the agency said has disproportionately targeted immigrant communities in the Twin Cities.
Along with the hearing on the campus of the University of St. Thomas, the CFPB issued an advisory opinion on Tuesday clarifying that federal mortgage protections under the Truth in Lending Act also apply to contracts for deed, an arrangement in which the buyer purchases directly from the seller over a period of time without using a mortgage from a bank.
Known by various names throughout the country, including “rent-to-own,” these contracts for deed often carry inflated prices and lack the oversight of a mortgage or lease agreement.
“Many people who peddle this product, they think they can sidestep federal mortgage protections,” CFPB Director Rohit Chopra, a Biden appointee, told KARE 11 in an interview. “We issued a new legal opinion today to make it fundamentally clear that those longstanding consumer protections apply.”
This issue concerning contracts for deed exploded onto the radar of state and federal lawmakers two years ago, when the local nonprofit Sahan Journal worked with ProPublica to publish an investigation on the lending practices. Since then, Minnesota Attorney Keith Ellison has pursued legal action related to contracts for deed, the state legislature has passed new protections and U.S. Senator Tina Smith has introduced legislation with a Republican co-sponsor at the federal level.
According to a report also made public Tuesday, contracts for deed have made a “resurgence” in recent years with 1,800 signed in Minnesota in 2021 alone. These types of contracts have specifically targeted the Somali community, the CFPB said, where families may have lower credit or can’t pay interest rates due to Muslim religious practices. (A contract for deed actually does involve interest rates, but the CFPB said these can sometimes be “hidden” or “undisclosed,” giving the perception to some buyers that they can bypass interest.)
“We initially found some of this targeting the local Somali community here,” Chopra said. “As we heard in testimony from others across the country, there are problems in other cities and we want to stop it before it spreads further.”
As part of its legal opinion issued Tuesday, the CFPB clarified that any buyer engaging in a contract for deed “will also generally be entitled to the protections associated with residential mortgage loans” under the Truth in Lending Act. That means sellers must ensure that a buyer can afford the home, must disclose all financial terms, and must avoid “balloon payments” that involve large lump sums at the end of a deal.
Fartun Weli, the CEO of Isuroon, works with Somali families in the Twin Cities. She told KARE 11 that she knows of at least 150 families who have fallen victim to contract-for-deed agreements. She said lenders are taking advantage of the desire to achieve the American dream, by preying on Muslim families that can’t pay interest rates due to religious practices, have large families and lower credit, and may face a language barrier.
“The contract-for-deed scammers are coming and saying, ‘oh, you don’t have to pay interest, but you can put so much forward.’ Families buy the house, not reading the contract because of so many barriers in language,” Weli said, “then they buy the home, put $100,000 or $200,000 in, and within a few months they’re evicted because they cannot pay.”
Weli said the consequences can be “devastating.”
“They’re taking advantage of a gap,” Weli said.
Gary Peterson and his friends are collecting donations to help people in their community.
ST. LOUIS PARK, Minn. — A St. Louis Park pumpkin display is raising money for their local food shelf.
Gary Peterson started carving and painting three pumpkins over a decade ago. It’s now grown to over 100.
“I’ve heard people say they’ve come from Hutchinson,” he said.
Peterson along with two of his neighbors have spent the last 14 years growing their display, turning it into a neighborhood event.
“It’s been incredible, I just can’t believe how much this has expanded,” he said. “We did it just because we like to and then people were asking to give us money to cover the cost.”
The trio refused to take people’s money, but then one of them had an idea.
“My neighbor, Steve Leensvaart, just mentioned how about we just do it for the STEP program and the STEP program is our local food shelf in St. Louis Park,” he said.
So, they started to collect donations to help families in need. They’ve raised hundreds of dollars and donated hundreds of pounds of food over the last few years, carving for a cause.
“It is more gratifying every year,” Peterson said.
He estimated they have over 100 unique pumpkins in their yard. They’ve created the displays and come up with new family-friendly concepts for people to enjoy. Peterson said about 30 of their neighbors carved their own pumpkins to be put on display, and it’s been a big hit.
“It’s great. In the last couple of years, it’s turned into more of a neighborhood event,” said Sarah Durch.
“We love this Halloween display, we come every year to see it. We love that the whole community gets involved to craft and carve the pumpkins,” said Jami Gordon-Smith.
“The shading and the details are unbelievable,” said Elizabeth Hanson.
Hanson hopes to take her 2-year-old son trick or treating for the first time but is worried the cold temperatures might keep them indoors.
“We’re going trick or treating hopefully,” she said. “He’s going to be a firefighter, but we’re probably going to have sweatshirts maybe like two pairs of sweatpants underneath. We’re going to be bundled up.”
Gordon-Smith said her family will be out Halloween night no matter the weather.
“Halloween only comes once a year, so you really have to take advantage and enjoy the evening no matter what the weather brings,” she said. “Guess it’s not totally unheard of in Minnesota to have a cold Halloween, but we are going to try and modify and do a lot of layers underneath our costumes and then we might add some hats and maybe some warmer socks.”
Durch also isn’t surprised they’re in for another chilly night.
“Well, what would Halloween be without Minnesota cold? I feel like every time you plan a costume you have to plan for how you can make this work if it’s snowing,” she said.
Peterson said they will have a bonfire and some hot chocolate and cider on Halloween to keep trick-or-treaters warm while they look at their pumpkins.
Click here to learn where you can see the pumpkins and how you can donate.
Jeremy Jourdain was 17 when he was last seen on Halloween 2016.
BEMIDJI, Minn. — The search for Jeremy Jourdain, who was last seen on Halloween in 2016, continues now eight years later.
Jourdain was last seen at a family member’s house in Bemidji, according to the U.S. Department of the Interior Indian Affairs. He left the residence near the 500 block of Wood Avenue after midnight and while people followed him, no one was able to find him.
Jourdain was 17 at the time.
Officials said he was wearing a blue and grey sweatshirt, and blue jeans when last seen. He is Native American and is described as 6 foot 5 and 175 pounds.
If you have any information on his whereabouts, you can contact the Bemidji Police Department at (218) 333-9111. Tips can also be sent to 1-833-560-2065, or you can email ojs_mmu@bia.gov.
The organizations say many Asian Americans are planning to vote despite lack of candidate outreach.
ST PAUL, Minn. — Most people have been contacted in some way shape or form by a campaign in the last few weeks. And if the polls are right and the race for president is a dead heat, every vote will matter.
That’s why this is a head scratcher:
According to a September 2024 voter survey by Asian American Pacific Islander Data, 27% of Asian-American voters said they hadn’t been contacted by either political party trying to get their vote. Last spring, earlier in the voting season, it was even more – 42%.
Asian Americans and Pacific Islanders are the fastest growing racial or ethnic group nationwide.
Their voter participation levels are growing too, with 60% of eligible Asian-American voters turning out in 2020. And AAPI Data reports as many as 90% of Asian Americans they surveyed said they plan to vote this cycle.
“Candidates are not reaching out to Asian Americans, which is a huge mistake,” said ThaoMee Xiong, executive and networking director of the Coalition of Asian American Leaders.
She says even though there are more than 200,000 eligible Asian voters in Minnesota, the Asian vote is under-appreciated.
“Neither the Democratic or Republican parties have been reaching out in huge numbers,” Xiong said. “They’re sending general mailers to everyone but … they need it in their native language.”
That’s why CAAL is partnering with two more organizations to keep voter turnout high and reach anyone candidates or advocates missed.
Xor Xiong is from Asian American Organizing Project, which focuses on engaging metro-area teens and young adults.
“Many of our communities are still facing barriers to go to vote,” he said. “There’s been more times than I like to admit in terms of when I was having a conversation over the phones of voters being surprised that they can take time off to go and vote, or they can bring the kids to the polling locations, or they can even bring someone to translate for them.”
“In Ramsey County, because of the large Hmong American population there, the polls in Ramsey County are federally required to provide interpreters and translated materials,” ThaoMee added.
Their nonpartisan campaign, Get Out the Vote for Asian Minnesotans, aims to get people registered and well-informed.
“Throughout Covid, there was a lot of anti-hate around the AAPI community and we are still feeling the impact of that to this day,” said Amanda Xiong, a community organizer with a group known as CAPI USA. “Even if folks are afraid to go to the polls, due to that, we try our best to then educate them around absentee ballots, voting early.”
“And so yes, there is a huge increase in terms of voter turnout, but then why is it still 70% feel as though they don’t belong?”
In 2021, the FBI reported a 168% increase in anti-Asian hate crimes.
In Brooklyn Park and Brooklyn Center, the groups knocked on at least 700 doors in one session alone while keeping safety top of mind.
“We make sure that there’s a car following all the door knockers,” ThaoMee said. “We put everyone on text chain … and we are putting a lot of precautionary measures in place for the day of voting.”
After the election, the CAAL plans to conduct surveys and send the results to county election officials. They’ve done this before and say it led to policy changes this year at the legislature including measures to ensure people have easier access to interpreters.
