Immigration Bond Lending Program
Updated: Aug 26, 2020
Disclaimer: We are continuing to learn about this issue area and, at this stage, it's important to recognize that we do not see bail or immigration bond funds as the best long term solution for people who are imprisoned or detained. The immediate need for this program is currently urgent due to the risk of COVID-19 in detention centers. Similarly, in the short-term, our goal is to ensure that people who have the option to leave the poor conditions of detention facilities, can do so regardless of the cost. However, in the long-term, the goal is not more and larger immigration bond funds. In financially supporting immigration bond funds now, we seek to share anonymized data transparently with our program partners as they aim to continue to push for larger immigration system and policy changes that prioritize humanity.
Community Credit Lab is proud to announce an initial $250,000 investment in an immigration bond lending program in collaboration with Washington Immigrant Solidarity Network (WAISN) and the Fair Fight Bond Fund. WAISN is receiving 0% interest loan with a term of 7-years to provide flexibility and patience for the team as they support immigrants to get bonded out of detention and connected to social and legal support. Expected losses on unrecoverable bond are covered by a 15% guarantee provided by WAISN.
This initial investment is a part of a larger initiative to efficiently raise capital needed to meet the volume of immigration bond requests WAISN receives. See image and explanation below for additional context.
Investment: Community Credit Lab is sourcing 0% interest loan capital from impact investors and foundations that will be used to capitalize the Bond Fund (or Loan Pool in the image below). At this time, the total amount targeted is $1,000,000 with an initial commitment of $250,000 from a private foundation.
Guarantee: Expected losses on the loans are covered by a guarantee sourced by WAISN through individual and other philanthropic donations and held in a separate account at Seattle Credit Union. Expected losses are estimated at 15% of the funds raised, which is the national average of losses on similar bond funds.
Flow: Loans are made to the Bond Fund (Loan Pool) once there is sufficient funding in the Guarantee Pool to cover 15% of the loan (expected losses). WAISN is able to use the proceeds of the loan to bond immigrants out of detention. Once the individual's immigration case is closed and bond is recovered, the recovered bond funds are returned into the Bond Fund and recycled until the loan needs to be returned to investors.
This structure will support WAISN to leverage individual and philanthropic donations at 6.5x - supporting the team to adequately respond to the growing issue of immigrant detention and support people to be released who are in detention due to a lack of access to financial resources.
More Information on the Fair Fight Bond Fund
The Fair Fight Bond Fund was established by WAISN in 2018 in response to the increase in immigrants detained at the Northwest Detention Center in Tacoma, Washington. Immigrants detained are exposed to inhumane and unjust living conditions as they await their immigration proceedings. The vast majority of people are being detained for their desire to live and belong in the United States. The Fund supports the one-in-five people who cannot afford the high price (average of $10,000-$15,000) of bonds and WAISN connects people to relevant legal and support services. It has been shown that immigrants that are connected to legal services and are awaiting their trial outside of detention are 20-times more likely to win their case.
Before COVID-19, bonding immigrants out of detention who could not afford the high cost of bond was urgent given the dire conditions people live in and lack of connectivity people have to their families and communities. Now, with the spread of COVID-19, the situation at the Northwest Detention Facility, like most prisons, jails and detention centers, is precarious. With people living in close quarters, having limited medical support, and exposed to poor hygienic conditions - an outbreak of COVID puts those detained at high risk. As a result, it is with even greater urgency now that immigrants detained are able to get bonded out.
Community Credit Lab aims to raise $1 million to adequately capitalize the Fair Fight Bond Fund. If you are an impact investor or foundation that is interested in supporting this initiative, please reach out directly (firstname.lastname@example.org).