Community Loan Fund
Through the years, many Orcas Islanders have purchased their home or financed some aspect of their business expansion by borrowing from individuals, rather than banks. These loans have largely been based on personal relationships, but some lenders have made loans because they view it as an important part of the island’s economic sustainability.
The idea of the Orcas Island Community Loan Fund – which is being incubated as a program of OPAL – is to continue this tradition of matching individuals who wish to lend money with individuals who wish to borrow by providing a nonprofit intermediary with the skills to underwrite borrowers and provide technical assistance so that borrowers will be successful.
The mission of the Loan Fund is to foster economic development and help sustain economic and demographic diversity on Orcas. The Loan Fund will make loans to creditworthy individuals and businesses who do not meet bank lending standards. Local bankers – understanding the limitations of their traditional institutions – are partners in this venture. The Loan Fund may also offer a line of credit for local nonprofits.
Is there a precedent for similarly structured funds?
- There are hundreds of successful community loan funds throughout the country.
What types of loans will the fund make?
- The Loan Fund will provide real estate based mortgage loans for individuals and non profits. It is possible at a later stage that the produce offerings may be expanded.
What benefits does the Loan Fund present to borrowers and fund investors?
- Community members not able to access traditional bank financing will benefit from borrowing capital to purchase a home or complete home repairs.
- Fund investors will benefit from a community-focused initiative providing a reasonable investment return, together with significant value to our local community.
What has to happen before the Loan Fund is launched?
- We must establish policies and procedures that follow the appropriate regulatory requirements monitored by Washington State’s Department of Financial Institutions.
- Information on the Loan Fund in 2016
Loan Fund Working Group:
- Michael Brennan, Investor
- Julie Brunner, OPAL Housing Manager
- Lisa Byers, OPAL Executive Director
- Jamie Cier, Branch Manager, Washington Federal, Eastsound
- Alex Conrad, International Business Consultant (lead on Loan Fund Business Plan Development)
- Martha Fuller, Retired CFO
- Ken Katz, Small Business Owner
- Allen Smith, Retired CEO
- George Zweibel, Retired Attorney