Block walk training

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Block walk training

  1. 1. ACCION USA “Block walking” Forging and fortifying relationships in the communities that we serve.
  2. 2. Why block walking? <ul><li>ACCION USA believes that it is important create strong relationships within the communities that we serve. </li></ul><ul><li>The block walking teams meet and greet business owners to spread awareness about ACCION USA's services while learning about local businesses and their needs. </li></ul>
  3. 3. Why the lack of Access? <ul><li>Some Common Reasons: </li></ul><ul><li>Lack of credit or low credit score </li></ul><ul><li>Lack of financial documentation or records </li></ul><ul><li>Business is informal—no commercial track record </li></ul><ul><li>Loan amount needed is too small </li></ul><ul><li>Some industries are considered to be high risk </li></ul><ul><li>Language Barriers </li></ul>“ We are attempting to fill in the gap that exists in financial services and helping individuals establish commercial credit.”
  4. 4. LOAN PRODUCTS <ul><li>Business Loans: </li></ul><ul><li>Established business loans up to $50,000. </li></ul><ul><li>Start-up business loans: up to $30,000. *with minimum of 6 months in operations </li></ul><ul><li>Non-Business Loans: </li></ul><ul><li>Credit start loans: $500-$700 (must have a provable income and no credit history). </li></ul><ul><li>Personal development loans: $1,000-$10,000. </li></ul><ul><li>Secured loans: $500 and up. </li></ul>
  5. 5. Interest Rates <ul><ul><li>FEES Financed into loan </li></ul></ul>None Pre-penalty Fee 3-6% of the loan amount Closing costs Fees $30 If Loan is Approved Application Fee In some cases, clients who are able to provide a cosigner will receive a discount of 2% on their APR when is 12-15.99% Rate decreases with each additional loan. Renewal Loans with perfect repayment on previous AUSA loans Fixed APR 8.99% - 15.99 % First-time Business Loans
  6. 6. AUSA Loan Application Process Client learn about ACCIONUSA Client fills out the application and send it to AUSA or provide the information over the phone to the loan consultant AUSA could offer the client range and Interest rate after loan consultant have all Information from the application Prequal Client submits complete documentation and gets Interviewed by Loan Consultant Loan Consultant analyze the loan and submit for Underwriting Underwriter Approves or Declines Loan Consultant inform the client the decision and Schedule the disbursement Once all documents are submitted to Underwriter it takes about 5-10 business days for an answer
  7. 7. Decision Factors: Character, Cash Flow, Collateral <ul><li>1.) Character (References) </li></ul><ul><li>Residential and commercial landlords, supplier, client and/or personal references. </li></ul><ul><li>2.) Cash Flow </li></ul><ul><li>An examination of sales vrs. expenses to demonstrate capacity to repay. </li></ul><ul><li>Business and personal bank statement review. </li></ul><ul><li>Start-ups must present 12 months of financial projections. </li></ul><ul><li>3.) Collateral or Cosigner </li></ul><ul><li>Business collateral such as titled vehicles may be accepted to strengthen app. </li></ul><ul><li>Co-borrower/Cosigner </li></ul><ul><li>- 21 years old or older </li></ul><ul><li>- Strong credit history </li></ul><ul><li>- Verifiable source of income separate from business </li></ul><ul><li>- Employed for at least 6 months </li></ul>
  8. 8. Decision Factors: Credit <ul><li>4.) Credit History </li></ul><ul><li>Credit Score 575 and above </li></ul><ul><li>Relatively low balances </li></ul><ul><li>Healthy % of available credit </li></ul><ul><li>Open accounts that are current </li></ul><ul><li>Zero FICO score is acceptable for credit start loans </li></ul><ul><ul><li>Automatic disqualifiers: </li></ul></ul><ul><ul><li>Current lateness on mortgage, auto, rent or child support payments </li></ul></ul><ul><ul><li>More than 3 late mortgage payments within the last 2 years </li></ul></ul><ul><ul><li>Negative amortization mortgages that adjust within the loan term </li></ul></ul><ul><ul><li>More than $3K in unpaid judgments, collections, liens, charge-offs </li></ul></ul><ul><ul><li>More than 3 properties (mortgage loans) </li></ul></ul><ul><ul><li>Property foreclosure within the last 2 years </li></ul></ul><ul><ul><li>Bankruptcy within the last 12 months </li></ul></ul>
  9. 9. Decision Factors: Industry and Purposes <ul><li>5.) Ineligible industries: </li></ul><ul><li>Non-profit, adult entertainment, gambling businesses; Pyramid or Multilevel businesses and other lenders. </li></ul><ul><li>Real estate related industries are also excluded such as: </li></ul><ul><li>Mortgage brokers </li></ul><ul><li>Title agencies </li></ul><ul><li>Apartment management companies </li></ul><ul><li>Market investment companies </li></ul><ul><li>6.) Loan Purposes: </li></ul><ul><li>Detailed list of expenditures </li></ul><ul><li>Contributes to the positive growth of business. </li></ul><ul><li>Loan uses that will clearly improve the revenues and/or profits of the business </li></ul><ul><li>Ineligible purposes include: </li></ul><ul><ul><li>Down payments on any real estate/closing costs on property or student loans </li></ul></ul>
  10. 10. ACCION USA Portfolio Profile AUSA MICROLOANS Most Common Business Sectors (By $ Value)
  11. 11. Client Impact <ul><ul><li>Creates employment in low- to moderate-income communities </li></ul></ul><ul><ul><li>On average, ACCION USA loans create 2 new jobs. </li></ul></ul><ul><ul><li>Since inception, AUSA loans have created approximately 11,500 new jobs. </li></ul></ul>
  12. 12. Soft Ways to approach a Business Owner <ul><ul><ul><li>Lead the conversation to the point where the client is talking about what he needs to improve his business, and see if ACCION’s products can help </li></ul></ul></ul><ul><ul><ul><li>Mention some of our products such as the green loan product. “Have you thought about upgrading to energy efficient equipment, or making your business more eco-friendly? ACCION USA offers a green loan product with a lowered interest rate” </li></ul></ul></ul><ul><ul><ul><li>Probe, Ask and Listen to their needs </li></ul></ul></ul><ul><ul><ul><li>Show that you offer solutions they match their needs </li></ul></ul></ul>
  13. 13. More Sample Questions <ul><ul><ul><li>How is your business doing? How are sales? </li></ul></ul></ul><ul><ul><ul><li>Are you looking to expand your business, either through renovation or increased services? </li></ul></ul></ul><ul><ul><ul><li>Are you thinking of renovating your restaurant/shop? </li></ul></ul></ul><ul><ul><ul><li>Would you like to purchase a new refrigerator or other new appliances? </li></ul></ul></ul><ul><ul><ul><li>Have you tried to apply for small loans with the bank? </li></ul></ul></ul><ul><ul><ul><li>Do you know about any of ACCION USA’s upcoming events? </li></ul></ul></ul>
  14. 14. Walk on… <ul><li>Thank you for your participation in a block walking event to spread awareness about ACCION USA’s products and services! </li></ul>

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