1) To whom does HMFI disburse loans??
HMFI looks for small business owners who are aiming to invest in and grow their businesses. Our clients have ran several different types of businesses: from catering and food trucks to hair styling or book keeping, we work with them all.
2) Can HMFI help me start a business?
Unfortunately, we are only able to effectively evaluate businesses which have been operating in the DC area for at least half a year. If you are just starting a business and looking for financing, we encourage you to reach out after the startup phase is over.
3) How much money can you loan, for how long, and what is the interest rate?
We give anywhere from $500 to $10,000, for 6-24 months, at a fixed 6% annual interest rate.
4) Other organizations charge substantially more than 6%. How can HMFI afford that rate?
HMFI is a non-profit organization recognized by the federal government. Through responsible lending practices and low costs, we are able to structure our loans so that they remain reasonably priced for our clients.
5) What if I need more than $10,000?
While we limit our individual loans at $10,000 dollars each, we are open to the process of refinancing following half a year of successful payments or more. Additionally, we have lasting partnerships with other organizations that may be able to assist you with your needs.
6) What kind of documents or info do you require for your underwriting process?
Other than the basic personal information submitted in the online application, we ask for:
- Last 3 months bank statements from all accounts
- Proof of Income (Pay stubs, other sources)
- Last 3 months business revenues/expenses (business ledger)
- Use of funds documentation
- Credit report (to be pulled up at doc collection meeting)
- 4 references
7) What does the underwriting process look like?
We take a holistic approach to our loan process that seeks to present an offering that will best allow our clients to grow their business and meet their financial goals. Rather than looking at credit score and traditional measures, we focus on payment history, cash flows, desired use of funds, and character references to evaluate a client’s fit for our loan product. To learn more about our the factors considered in our underwriting process, visit our Small Business Loan page.
8) Why does HMFI need my credit history? Will the check hurt my credit score?
While we have a holistic approach to underwriting, it is important for us to understand what existing financial obligations you may have when determining the appropriate loan size. We utilize a “soft pull” of your report, avoiding the negative impact that a commercial lender’s “hard pull” would have.
9) I do not feel comfortable providing a piece of information online. What should I do to complete the application?
We understand that we require documents that reveal substantial information about our clients’ lives. If you are concerned about providing information through our website or email, we encourage you to apply with as much as you can, and our loan officer will be able to discuss your case over the phone or in person.