Presentation on theme: "LOCO Day 2 CEF Structure. Broad Philosophical Objectives To help individuals lift themselves out of poverty. To empower individuals to actualize their."— Presentation transcript:
Broad Philosophical Objectives To help individuals lift themselves out of poverty. To empower individuals to actualize their goals. To invest in their potential.
Program Objectives for Borrowers Borrower pays off loan of $300 to qualify for a larger loan ($600). Borrower continues to build good credit and build assets so that they can “outgrow” us and take advantage of the offerings in the mainstream economy. Borrower becomes engaged in program, invested in the other borrowers’ success and the program’s success. Ideally some of these borrowers will become loan officers and mentors for future borrowers.
Program Goals for CEF, UNC and Chapel Hill CEF creates a replicable, lasting,successful program that other universities want to implement in their community. CEF creates strong partnerships with local NGOs, city government, local small businesses and financial institutions. CEF provides UNC students with opportunities to gain applicable skills and be instrumental in building an organization.
Umbrella Structure We are a 501 C-3 non-profit organization that operates under the Campus YMCA. We are staffed by an all- volunteer coalition of UNC students and alumni. We are entirely student- run. We are coalition of Carolina Microfinance Initiative, HOPE Homeless Outreach and Poverty Eradication, and the Center on Poverty, Work and Opportunity at the Law School
Break-Down CEF Loan Officer Team Outreach Committee Fundraising Committee Resource Development Accounts Management Education Committee Allocations Committee
Allocations Committee comprised of 6 committee chairs + senior loan officers + senior secretary (13 people) approve applications formalize policy make final decisions for program and borrower-related issues coordinate program
6 Committees 1. Accounts Management 2. Resource Development 3. Outreach (Campus, Community, and Public Relations) 4. Educational Workshops 5. Fundraising (Events and Grant-writing) 6. Loan Officer Team
Loan Officer Team Structure Administrative Team: Senior Accounts Manager Loan Officer Coordinator Education Chair Outreach Chair Fundraising Chair Resource Development Chair Senior Secretary LO Team A 1 Team Coordinator (5-6 Loan Officers) 1 Accounts Rep 1 RD Rep 1 Education Rep 1 Outreach Rep LO Team B 1 Team Coordinator (5-6 Loan Officers) 1 Accounts Rep 1 RD Rep 1 Education Rep 1 Outreach Rep LO Team C 1 Team Coordinator (5-6 Loan Officers) 1 Accounts Rep 1 RD Rep 1 Education Rep 1 Outreach Rep LO Team D 1 Team Coordinator (5-6 Loan Officers) 1 Accounts Rep 1 RD Rep 1 Education Rep 1 Outreach Rep
Focus Groups (in development) Small Business Coaches Legal Consulting (for program and borrowers) Ad-hoc think tank groups on specific issues/policies (i.e. drugs and alcohol, mental health, convenient and safe savings, repayment)
Outreach Where? Men’s shelter on Rosemary (Resume workshops, Talking Sidewalks, HOPE presence) Women’s shelter Homestart on Homestead Dr. (Playgroup on Tuesday evenings and resume workshops) Referrals from Organizations (i.e. PATH, Orange County Literacy Council, Oxford House, Women’s Center) Who does the outreach? Outreach committee organizes this but ideally Loan Officers make the initial contact.
Diagram 1: Application Process REFERRAL from partner agency, current borrower, or outreach workshop WRITTEN APPLICATION and intake session INITIAL REVIEW by Committee DEFINE concerns and any questions DESIGNATE 2 Loan Officers FOLLOW-UP INTERVIEW AGREE on potential repayment plan ADDRESS concerns and any questions FINAL REVIEW by Committee APPROVED NOT APPROVED: Connect to other resources, workshops, and services in place of a loan and discuss necessary steps to later becoming eligible for CEF support VERIFY references, housing, and employment 1. Sign agreement, 2. Make savings deposit 3. Receive loan
Application Procedure 1. Application can be completed with CEF representative (or not). 2. Application is submitted. 3. Two loan officers are assigned (create your own teams if you wish) 4. Sunday at 7:00 the 2 loan officers summarize application to Allocations. Concerns and questions are voiced. 5. Loan Officers check references, do a background check, and do a follow-up interview. 6. The following Sunday at 7:00, the 2 loan officers report findings and the application is voted on.
No Vote 1. L.O.’s go to Resource Development Group (Chair: Jon Young) and collect list of useful resources. 2. Meet with applicant and explain reason for denial and explain list of resources. 3. Optional: help applicant call these resources
Yes Vote 1.Price the loan (the borrower has done this in the application, but this should be re-assessed) 2. Draft terms of agreement with borrower
Required Savings Program 1. Before loan can be disbursed, the borrower must pay an initial savings deposit of 10% of the price of the loan. (The loan is $250, the borrower produces $25). 2. CEF matches this deposit. The deposit cannot be accessed until the loan is paid off. 3. Weekly payments are part repayment, part savings. Ratios are negotiable and based on the borrowers’ priorities, although the minimum savings requirement is 10% although on average it is 33% –$10 (7:3) –$15 (10:5) –$5 (4:1) 4. These savings are matched as well, up to a total of $100 (including savings deposit).
Terms of Agreement 1. The amount of loan. ($250) 2. The required savings deposit. ($25) 3. The weekly payment. ($10) 4. The repayment to savings ratio. (8:2) 5. Terms of Agreement can be renegotiated every 4 weeks depending on changing circumstances in borrowers’ income. 6. Sweat Equity- if borrower cannot produce weekly payment or only a part of it, the borrower agrees to work 1 hour at the HOPE Garden (there are alternatives to HOPE garden 7. Borrower agrees to come to weekly meetings and workshops.
Loan Disbursement 1. Checks are made out directly to recipient (i.e. landlord, school, phone company, etc.) and hand-delivered by Borrower and Loan Officer. 2. If there are many components to the loan, these may or may not be made all at once.
Weekly meetings Loan officer and borrower meet weekly to collect payment and “check in” whenever they wish. Weekly group meeting (coffee or dinner) ( time and place will be determined when new group forms. Bring problems to borrower group team at meeting (Sundays at 6:00) or with more serious problems, Allocations (Sunday at 7:00)
Payment Collection 1.What if they bring more than than the weekly payment? Accept the agreed-upon payment, and bring this question to Allocations. 2. What if they bring less than the weekly payment? Accept it. Apply repayment to savings ratio. Also do Sweat Equity. We advise that at least one loan officer do Sweat Equity with the borrower. 3. What if they don’t have the payment? Sweat Equity. 4. What if they don’t show up to meeting and don’t call to reschedule? Keep trying to contact them, and emphasize that the best thing to do is stay in communication.
How do we encourage repayment? -Savings program and matching funds -Communication, trust, interpersonal accountability - Re-negotiating terms Is there recourse for borrower leaving program with loan un-paid? At this time, there is no recourse in place.
Borrower pays off loan. Graduate options –applies for a larger loan $600 max –trains to be a loan officer or volunteer for CEF in another capacity
Banks RBC- operational funds (On that account: Maggie, Brian, Jon, Alexis) -loan disbursements -loan repayments -matching funds -food, copies and misc. Self-Help Credit Union in Durham- savings (On that account: Alexis, Jon, Brian) -savings deposits -savings
Chapel Hill PATH IFC RBC Self-Help Credit Union Department of Social Work at UNC Orange County Literacy Council Town of Chapel Hill Chapel Hill Downtown Partnership Senior Marshalls Good Work Job Link Vocational Rehabilition Women’s Center SCORE Law School- Heather Hunt and Dr. Nicholl Durham Partners Durham Rotary Durham Department of Social Services Criminal Justice Resource Center MDC TROSA