Tamara Underwood
Community Capital Resources in Hawthorne, one part small-business lender and another part financial educator, has seen a shift in demand and a new breed of borrowers.
“We”™re starting to pick up people who had their bank lines of credit recalled or ended and who need that ongoing injection of cash,” said Tamara Underwood, small-business program manager. “Initially, during the credit crisis there was a slight fall off in those seeking loans after the Lehman bankruptcy. Then, since January, the demand has shot up.”
Leslie Allicks, owner of Lola”™s Tea House in Pelham and loan client, is celebrating her restaurant”™s first year in business.
“Sometimes new businesses can be overwhelming, but they were such a resource to me through the whole loan application process and even now, when I ask a question, they refer me to the right people,” Allicks said. “They are a good source for follow-up questions.”
Underwood said the nonprofit financial institution is concerned about being repaid, but that a business”™s success is important to them.
“We are about lending and it is about access to capital, but we want to support them through the entire process,” she said.
Founded 20 years ago, CCR was born out of the housing crisis facing the region, Underwood said, “as a way to develop affordable housing for both rental and for-sale properties.”
Initially, the program helped people placing down payments on houses or co-op purchases, but could also be used for small-business financing.
“People said to us, ”˜There is a real gap in the market for small businesses. The banks don”™t lend to startups and they don”™t make small loans, either. And there are a lot of businesses out there that would benefit from an alternative lender,” Underwood said.
“So, in 2003, we launched a micro-loan program with grants provided to us by banks. It was the seed capital for our loan fund.”
CCR applied and became a Small Business Administration (SBA) micro-lender for Westchester County; Rockland, Putnam and Dutchess counties followed.
SBA provides grant money and access to capital, while Empire State Development Corp. assists with loan-loss reserves, Underwood said. Other sources contribute, but to a lesser extent.
An average loan size is $10,000 and CCR may loan up to $25,000.
In addition to lending, financial education grew out of an individual development accounts program, which was about asset-building.
Peer lending support groups foster an environment where people can test the waters on borrowing, Underwood said.
She said they are seeing people with higher credit scores applying for loans.
“A year ago, people had credit scores of around 640,” she said. “Now, we”™re catching the 640 to low-700 folk that would have been able to potentially get an express loan through a bank and now are not eligible.”
Nick Hernandez, owner of New Roc Sabor Latino in New Rochelle, said his credit wasn”™t that good but he was able to obtain a loan.
“If they (CCR) can help me, they can help someone else,” he said. “It really works.”
For information, visit www.ccrhv.org.
