A few months ago, we shared Part 1 of our two-part interview with Sheila Wheeler of Self Help Credit Union. Below, you’ll find Part 2; enjoy!
Charlotte Business Resources (CBR): What should small business owners be prepared to discuss before meeting with Self Help Credit Union?
Sheila Wheeler (SW): When we evaluate a loan application, we pay attention to the whole picture – the numbers and the story behind the numbers. Small-business owners should be ready to answer the questions below:
Here’s a guide to what we look at:
1. Industry-relevant experience: What experience do you have in the industry of your business?
2. Personal credit history: Do you have a history of good on-time payments? (For a free copy of your credit report, go to www.annualcreditreport.com.)
3. Capital/owner’s investment: How much money can you invest in your business or project? We generally like to see an investment of 20 to 30 percent.
4. Cash flow: Can your business cover expenses and the loan payment?
5. Collateral: What can you use to secure the loan? Possible collateral might include real estate, cash and, in some cases, equipment or vehicles.
6. Personal debt-to-income ratio and secondary sources of income: It can take a long time for a business to become profitable enough to start paying its owners. For start-ups especially, we look for the borrower or co-signer to have a secondary source of income.
These criteria are on our website, along with links to good resources for business borrowers. We also have cash-flow worksheets available on our website to help business owners make these calculations. (To access these click the Apply Now button on the business loan page above.)
CBR: What are the most common reasons or challenges that bring small business owners to Self Help?
SW: We often provide financing for borrowers who are just slightly outside the lending criteria of big banks. Because of that, the businesses that come to us are often those who could benefit from a slightly more flexible, individually tailored loan.
We’ve been working in the community for many years, so people know us. Many business owners also come to us because they trust us to be fair and honest, and because they know we’ll treat them right.
Give us a call! We’re here to work with you.
We do all kinds of loans, but we particularly have expertise in these sectors:
• Green businesses: sustainable energy, recycling, land-preservation organizations and more.
• Education and child care: financing for public charter schools and for child care businesses (both in-home and center-based child care).
• Real-estate development: especially in distressed areas, and especially for affordable housing development.
• Healthy foods: especially businesses that are part of the “mid-tier value chain” – distributors, processing facilities, dairies, seed companies, etc.
If you’re interested in getting a business loan with us, contact Sheila Wheeler at (704) 409-5926 or Sheila.Wheeler@self-help.org.