BORROWER & GUARANTOR FAQ

Borrower FAQ

Guarantor FAQ

Is it really interest-free? What’s the catch?

There is no catch – we’re here to support our community! This is not a hand out – we’re giving you a hand up. You will be required to pay back the amount you received over time. You will not pay any interest or additional charges in exchange for receiving your loan.

What are the basic loan criteria to qualify for a loan?

Applicants generally must meet the following criteria. If your situation falls outside the criteria, please do not hesitate to contact us directly to discuss your situation.

  • You are Jewish, live in a Jewish household (i.e. Jewish partner), or work for a Jewish communal agency.
  • Currently resides in the greater Austin area (Travis, Williamson and Hays Counties) with at least three months residency. 
  • The request is deemed meaningful or necessary by the Loan Committee.
  • At least eighteen (18) years of age
  • A U.S. citizen or legal resident
  • Can demonstrate the ability to repay the loan on time
  • Paid in full any prior loan from HFLA
  • Not currently a Guarantor on a current loan
  • Loan applicants need at least one guarantor, and depending on loan size, may require more.
What size loan can I receive?

The loan amount depends on many factors. The average size loans are $5,000. 

What can I get a loan for?

As long as you have a need and can identify a repayment plan, HFLA is here to help. Examples are:

  • Summer camp
  • Tuition, school expenses, professional education, study abroad or other education based expenses
  • A trip to Israel
  • Healthcare, medical, dental and orthodontic expenses
  • Fertility
  • Car payments and repairs
  • Rent, mortgage payments, security deposits and home repairs
  • Childcare
  • Pay off credit cards incurring interest
  • Funeral expenses
  • Catch-up on bills
  • Living costs while job searching or starting a business
  • Unexpected costs that are sometimes difficult for people to plan for or simply absorb
  • Edit cards incurring interest, car loans and repairs and all sorts of unexpected costs that are sometimes difficult for people to plan for or simply absorb.
  • . . . and many more, let’s discuss!
How long will I have to repay the loan?

We will work with you to identify a mutually agreed upon repayment schedule, which is typically 24 months. Most general loans receive a 3 month grace period between loan disbursement and the start repayment. The timeline can vary depending on the loan amount and specific circumstances.

Is this confidential?

Yes. We respect your privacy and will maintain confidentiality. In fact, we do not even share information about each loan with every board member. 

Who decides if my application is approved?

Loans will be approved at the sole discretion of the HFLA Loan Review Team.

Why does HFLA require guarantors?

HFLA requires co-signers on our loans for a very simple reason: to ensure that we can continue to help people in the greater Austin area. Co-signers serve as our form of back up, in the event that a borrower defaults on a loan. When you borrow money from HFLA, you only pay back what you borrow. We do not charge interest, therefore we do not generate any money from the loans that we grant. We exist solely on donations, grants, and our loans being paid back.

Who can be a guarantor for my loan?

A guarantor can be (almost**) anybody that is over 21 years of age who is willing and able to pay back the remainder of your loan if you default. **The three exceptions are:

  1. Spouse
  2. Clergy
  3. Current Loan Recipient
How many guarantors are needed?

A minimum of one guarantor is needed for loans up to $5,000. For loans greater than $5,000, two guarantors are usually required.

I am too embarrassed to ask for a guarantor. Do you have any tips?

Of course! Asking for a guarantor on a loan is nothing to be embarrassed about. Everyone needs help at some point in their lives, and chances are that there is someone in your life who will understand your situation and be willing to help you. A co-signer is a person who will help you help yourself through an interest-free loan. When asking someone to guarantee you may want to consider the following:
Ask people who are permanent figures in your life—family, close friends, trusted religious figures, etc… It helps to ask someone who has known you for a long time and knows your character.

Explain your current situation to the potential guarantor(s). Be honest and open! If the person you are speaking with truly understands why you need the loan, they will be more willing to help.

Show your potential guarantor(s) that you have the ability to repay a loan through HFLA. It may be helpful to show them the budget sheet from our application and the surplus that remains in your budget after you subtract your expenses.

Let your potential guarantor(s) know that they do not have to disclose their financial information to you. If they decide to guarantor for you, they can email, fax, or mail their application and documents directly to HFLA.

Do not expect an answer right away! Ask your potential co-signer(s) to think about it and get back in touch with you after a day or so. Assure them that HFLA is happy to answer any questions that they may have, and that they may call us at 512-677-4352 or email info@hfla.org.

What happens to my loan after I repay it?

HFLA is based on a recycling model where loan repayments are put back to work funding new loans over and over again.

What does the Torah say about giving interest free loans?

In Parashat Mishpatim, God tells Moses and the people of Israel that they may not derive personal benefit from loans made to members of their community – in other words, they may not charge interest. This is the foundation – the inspiration – for our work. HFLA makes it possible for you to fulfill the laws of Judaism.

“If you lend money to My people, even to the poor among you , do not act toward them as a creditor; you shall not charge them interest.” – Exodus 22:24

“You shall not lend him your money at interest, or give him your food for profit.” – Leviticus 25:37

How long does it take to receive a loan?

HFLA will contact you within a few days of submitting a loan application. Let us know if your loan request is urgent so that we can review your application quickly. After reviewing your application, collecting supporting documentation, speaking with the guarantor, and reviewing and approving your loan with the HFLA Loan Committee, we will provide the loan agreement and check.

 

How can HFLA afford to provide loans without any interest or fees?

Thanks to the generosity of HFLA donors and volunteer board members, we are able to provide interest free loans with no fees. Also, because the repayment rate is so high, the money is put back to work funding new loans over and over again, multiplying the number of people helped by the same dollars many times over. When a borrower repays their HFLA loan, they make it possible for someone else to benefit from those same funds.

 

GUARANTOR FAQ 

Why does HFLA require guarantors?

HFLA requires co-signers on our loans for a very simple reason: to ensure that we can continue to help people in the greater Austin area. Co-signers serve as our form of back up, in the event that a borrower defaults on a loan. When you borrow money from HFLA, you only pay back what you borrow. We do not charge interest, therefore we do not generate any money from the loans that we grant. We exist solely on donations, grants, and our loans being paid back.

I’m ready to be a guarantor! What do I do?
  1. Fill out a Guarantor Application at www.hebrewfreeloanofaustin.org/guarantor-application.
  2. Print, sign, and notarize our Guarantor Agreement at here. Email a digital copy to loans@hfla.org and mail the original copy to:
    Operations Manager
    Hebrew Free Loan of Austin
    3571 Far West Blvd. #233
    Austin, TX 78731
  3. Email proof of liquid assets to loans@hfla.org.
  4. Our Loan Committee will let you know if you need to collect any further supporting documentation.
Who can act as a guarantor?

Guarantors must be permanent residents of the United States, 21 years or older, and have a steady source of income. The guarantor does not have to be Jewish or reside in Austin. Parents or other relatives may act as a guarantor.

Who can NOT act as a guarantor?

The following people may not act as a guarantor:

  • borrower on another HFLA loan
  • borrower’s spouse
  • rabbi, cantor, or director/clergy of a Jewish institution
  • anyone whose position depends on the goodwill of the community
Is this confidential?

Yes. We respect your privacy and will maintain confidentiality. In fact, we do not even share information about each loan with every board member.

Does a guarantor have to be Jewish?

The guarantor does not need to be Jewish.

Are there any income requirements for guarantors?

It depends on the size of the loan requested. As loan amounts increase, guarantors may need higher incomes to qualify, depending on the total number of guarantors. To qualify, a guarantor will need a steady source of income.

If I'm retired, can I still be a guarantor?

Yes, as long as you meet the other requirements and your net worth and income streams allow you to comfortably take on the financial responsibility of guaranteeing a loan.

Will guaranteeing affect my credit?

We are not a credit reporting agency, so guaranteeing a loan should not affect your credit, unless the loan goes into default.

Does a guarantor have to submit a credit report or score?

While we rarely request a credit report from a guarantor, we do reserve the right to request one depending on the situation.

What is the repayment rate of loans?

98% of loan recipients repay their loans.

May I guarantee more than one Hebrew Free Loan at a time?

Yes. You can guarantee multiple loans as long as you are in a financial position to make payment on all of the loans in the event the loan recipients default.

If I currently have a loan with Hebrew Free Loan, may I also guarantee a loan?

No. If you are a current loan recipient, you may not guarantee a loan.

May I apply for a loan if I am an active guarantor?

No. You may not apply for a loan of your own until the loan that you are guaranteeing has been paid in full.

Am I allowed to know the balance on the loan I am guaranteeing? How do I find this out?

Yes. Guarantors can request information about the status of a loan directly from the loan recipient or Hebrew Free Loan of Austin. To request this information, send us an email (finance@hfla.org) or call 512-677-4352.

Can I support HFLA other than giving money?

Yes! Please visit OTHER WAYS TO HELP. Please contact HFLA so we can discuss your idea or make suggestions, send us an email at info@hfla.org.

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