End of the route nears for Five Star Service Express

Northwestern Financial Review, Feb 15-Feb 28, 2005 by Hilgert, Jackie

After logging nearly 2,000 miles on a six-state tour of the Midwest, U.S. Bank is considering whether to extend the run for its popular home mortgage promotional vehicle, the Five Star Service Express. Before that decision is made, however, the bank and its partners, Freddie Mac and Sacramento-based Community College Foundation (CCF) will keep on rolling through under-banked areas of central Iowa, making several stops in Des Moines before completing its pilot run in the Quad Cities.

The Five Star Service Express is a modified city bus featuring a dozen Internet-ready computers. It is staffed by U.S. Bank employees, versed in mortgage lending and retail banking. The purpose of the vehicle, which is owned and operated by CCF, is to deliver technology-based education on home ownership to areas typically considered underserved by traditional credit sources.

CCF calls it bridging the digital divide. Under its Community Connect program, the foundation converts mass transit buses into eBuses, which organizations may then purchase or lease for outreach initiatives. Past eBus programs have included Internet/life skills training for foster youth and youth at risk programs, foster youth small business development programs, children's safety fairs, low-income vision screening, and financial literacy for students, adults and senior citizens.

Freddie Mac partnered with CCF in order to put home-buyer education on wheels. It leased a fleet of eBuses and then invited a few large banks to drive the program that uses technology to dispel the myths and misconceptions surrounding home buying. Misinformation is what often keeps economically disadvantaged families from achieving the dream of home ownership, said Mark Spates, director of Expanding Markets for Freddie Mac.

U.S. Bank unrolled the Five Star Service Express last September in Minneapolis. Ed Shanks, executive vice president of U.S. Bank Home Mortgage, said the bank was allowed a six-month lease for its initial run so it opted to focus its promotion on the Midwest. "We knew we wanted to keep the bus in a metro location for approximately one month. So that would expose us to five or six major metropolitan areas during that time period," Shanks said. They also wanted to keep the promotion in an area where the bank's footprint was fairly well established. "We're still growing the western markets, so we decided to keep it in the Midwest, then we settled on the cities," he said.

After five weeks in the Minneapolis-St. Paul area visiting events such as the Mexican Independence Day Celebration and the Hmong Resource Fair, the bus rolled east into Madison, Wis. After a four-day stop, the eBus advanced to Milwaukee for a five-week stay. Then it was on to another five weeks spent in St. Louis, followed by a month in the Kansas City area. The bus closes its run in Iowa in early March.

During each market visit, U.S. Bank partners with local non-profit groups that organize events around the opportunity to learn about home buying. During the visit to the Kansas City metropolitan area, the bank partnered with ACORN, the Economic Opportunity Foundation, United Service Community Action Agency and the Housing and Community Development Division of the Unified Government of Wyandotte County and the City of Kansas City, Kansas. U.S. Rep. Emanuel Cleaver (D.-Mo.) welcomed the Five Star Service Express into his community saying, "Freddie Mac and U.S. Bank are to be congratulated for their efforts in working creatively...to expand home-ownership opportunities for more households."

Shanks said bankers who staffed the bus early on quickly learned that visitors' interest wasn't limited to home buying. "While people are anxious to talk about home ownership, they also wanted to know about banking services in general," Shanks said. "It became clear very quickly that this was an effective tool for going into these underserved neighborhoods to just talk about banking."

Bankers on board talk to people about their financial situations and they listen to people describe their goals and desires. There's no selling involved, Shanks said. The eBus also was not designed for transactions. Yet visitors have learned about the challenges surrounding home buying, had credit reports pulled and analyzed, and have been counseled by bankers in how to establish or improve their credit, discern how much house they can afford, and discuss their ability to make a down payment.

U.S. Bank also encouraged visitors to use the Internet-ready bus to become a customer. Between stops in Minneapolis and St. Louis, Shanks said the bank opened more than 400 checking accounts, more than 25 savings accounts, took 30 credit card applications, counseled more than 700 individuals in home ownership opportunities and took about 40 mortgage applications.

The bank also maintains a human resource presence on board. "A lot of people came on and wanted to learn about careers with U.S. Bank," Shanks said. In each market, someone was available to demonstrate the bank's web site, which includes employment opportunities. Online applications for employment were taken, although Shanks couldn't say if any new hires could be attributed to the eBus.