ACCION USA Partner Training

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  • Go to internet here.
  • NOTES: Send us a heads up that you are referring a client and they’ll apply online.

Transcript

  • 1. ACCION USA Microfinance for Small Businesses ACCION USA 56 Roland St., Suite 300 Boston, MA 02129 Orientation July 14th, 2010
  • 2. Agenda
    • ACCION USA and Microfinance Initiatives
    • ACCION USA Loan Products
    • Requirements and Disqualifiers
    • Application/Referral Process
    • Questions
  • 3. What is ACCION USA? At ACCION USA, we are committed to serving low- and moderate-income communities by providing access to business financing and counseling. Our focus is on microentrepreneurs, often minorities and women, who build businesses, provide jobs, create assets for themselves and their families and contribute to the development of their communities.
  • 4. A Brief History of ACCION in the US
    • The US ACCION Network is currently the largest microlender network in the United States.
    • Operates in 9 states with direct lending offices and has national reach online at www.accionusa.org .
    • More than 20,000 clients served, averaging $7000.
    • Over $210 million lent network-wide to date.
  • 5. Who do we lend to?
    • ACCION USA’s clients range from small home based entrepreneurs to established storefront business owners
  • 6. Microlending Initiatives
  • 7. Brewing the American Dream
    • Free Speed Coaching for Food, Beverage & Hospitality Business Owners
    All food and beverage entrepreneurs are invited to attend!
  • 8. What is Kiva? www.kiva.org
  • 9. ACCION USA Small Business Loan Products
    • Loan Amounts:
    • Established Businesses
      • 6 Months of Operations & Profitable
      • Loan Amount: up to $50,000*
    • Start-Up Businesses
      • 6 Months of Operations but Not Yet Profitable
      • Loan Amount: up to $30,000*
    • Transition Businesses
      • Business Purchase or Change of Location
      • Loan Amount: up to $30,000*
    • * The average ACCION USA loan size is $7,000
  • 10.
    • Business Installment Loans :
    • Interest rates: 8.99% – 15.99%
    • Terms up to 60 months (based on loan amount and purpose).
    • ACH Monthly Payments
    • 3-5% closing fee and $30 application fee if approved
    • No prepayment penalties
    Small Business Loan Product Specifics
  • 11. Yes/No Variables
    • Provide the following information to your clients and pre-screen them based on these guidelines.
    • FICO > 575 (large loan sizes will require strong credit history)
    • No lateness in last 12 months on Rent or Mortgage
    • No unpaid judgments, liens, collections accounts, or past due above $3,000
    • No discharged Bankruptcy in last 12 months
    • No foreclosure or short-sell in last 2 years
    • No more than 3 mortgaged properties
    • No Adjustable Rate Mortgages (ARM) adjusting during loan term, Negative Amortization loans or Pick-a-Payment
  • 12. Requirements for Start-Ups and Transition Businesses
    • Co-signer who is not involved to the business and is financially independent
    • 2nd source of income from client OR household member (if the business is not profitable)
    • Detailed market analysis and 12-months of financial projections
    • Technical expertise and commitment to the business
    • All required licenses and permits
  • 13. Basic Documentation
    • 3 Months of Business and Personal Bank Statements.
    • 2 Years of Taxes and Business Financials for requests over $10,000
    • Detailed description of how loan money will be invested in the business
    • 2 Forms of ID (one government issued)
    • All necessary permits and licenses
    • Most recent utility bill from home residence and business
    • Business Lease
    • Mortgage notes (as applicable)
  • 14. How Can YOU Get Involved?
    • To help entrepreneurs receive pre-bank financing, encourage them to:
    • Apply online at www.accionusa.org ;
    • Receive an application from you;
    • Download the paper application from our website;
    • Call ACCION USA and apply over the phone
  • 15. Applying Online
  • 16. AUSA Loan Application Process Client receives ACCION USA loan Information Client Applies Online or fills out paper application. AUSA acknowledges receipt w/in 48 hours AUSA contacts client regarding application to offer loan amount range, Interest rate, and request documents Application submitted for Underwriting Underwriter Approves or Declines ACCION sends disbursement Documents via secure e-mail to client Once ALL DOCUMENTS are submitted process takes 5 – 10 business days Client submits documentation via fax or email and gets Interviewed by Loan Officer. This is often the most difficult and time consuming stage. Prequal
  • 17. Loan Packaging Best Practices
    • ACCION USA recommends the following steps to improve conversion and ensure cost-effective customer service:
    • Ask client to pull his/her own Equifax credit report and score on www.annualcreditreport.com .
    • Review the client’s credit report and pre-screen application. Inquire specifically about:
      • Current Loan Payment Amount
      • Mortgage terms
      • Current business income and ending balance on bank accounts
      • Client’s ability to provide a co-signer if required or to lower interest rate by 2%
  • 18. Loan Packaging Best Practices Cont.
    • 3) Inquire about client’s ability to provide full documentation and explain the importance of submitting accurate and complete materials on a timely basis. The client’s capacity to repay, loan amount, and terms will be based on the documents.
    • 4) If the client has difficulty providing required documentation, inquire if there are alternative documents that can demonstrate the client’s strengths
  • 19. Q & A
    • Questions?
    Kimberly Geronimo, Loan Consultant 617-616-1599 [email_address]