The Hebrew Free Loan Association of Tucson has been around since 1947.
Although it provides an invaluable service — granting interest-free financial assistance to those in need — its longtime president, Phil Bregman, has often called the association “the best kept secret in town.”
But in the past nine months, the Hebrew Free Loan has been increasing its visibility through a new employee financial assistance program.
Under the new program, employees at enrolled businesses can receive a loan of up to $750 and repay it through payroll deductions over 12 months, Bregman explained at a recent meeting with employees of the Jewish Federation of Southern Arizona, which will offer the program to its staff. There is no cost to the employer or the employee, and a co-signer is not required.
Loans can be made for a variety of needs, such as unexpected auto repairs or health care deductibles.
The employee financial assistance program, which is still in the pilot stage, began in March with Handmaker Jewish Services for the Aging, says Bregman. It was so successful that the Hebrew Free Loan has already expanded it to several other businesses, both in the Jewish community and the general community, with more in the pipeline.
Unlike many other Hebrew Free Loan Associations around the world that make loans only to Jewish applicants, Tucson’s program always has been non-sectarian, Bregman says.
With the new employee assistance program, “we’re investing in our local workforce,” says Yana Krone, the Free Loan’s program coordinator, “and trying to keep people away from high interest loans, such as auto title loans.” High interest loans, she notes, only add stress for people already in a financial bind.
Krone came up with the employee assistance program after hearing on a podcast that the average American does not have $1,000 in savings in case of an emergency.
If an employee’s car breaks down and they can’t repair it, this puts stress not only on the employee but also on the employer. And hourly workers don’t get paid for days they miss. “It becomes a vicious circle,” says Krone.
The podcast also talked about parents who can’t drop their children off at daycare because they cannot afford to buy the diapers the daycare center requires. “So if you can’t afford diapers for your child, you can’t go to work. It blew my mind,” says Krone.
Another reason the Hebrew Free Loan initiated the employee financial assistance program is that many people were having trouble finding a guarantor for a traditional loan application, she says.
One recent loan that warmed her heart was for $600 that allowed “a gentleman to get his tooth fixed,” she says.
But loans doesn’t have to be used only for a crisis. Loans can also be used to enroll a child in dance classes or soccer camp, Krone says, or for a variety of other purposes. All loans are subject to approval.
Krone points out that loans don’t only benefit the borrower — they also benefit the school or other program that receives the funds. “It’s a giving forward program,” she says.
While the employee assistance program has a limit of $750, larger loans, up to $5,000, are available with a co-signer through the association’s traditional program. Traditional loans have a longer repayment term, usually two to three years.
There are many uses for such loans, from paying rent and utilities, to expanding a small business by buying computers or other equipment.
Debt consolidation is another way people have used funds from Hebrew Free Loan.
All of the funds for the Hebrew Free Loan Association come from donations, Krone says. Donations to the Hebrew Free Loan Association, a 501(c)(3) nonprofit organization that supports the working poor, are eligible for the Arizona Charitable Tax Credit.
Individuals may now contribute up to $400 and married couples filing jointly may contribute up to $800. The deadline for contributing has been extended to April 15 or when people pay their taxes, whichever comes first.
In addition, donations get recycled, says Krone, explaining when loans are paid back to the Hebrew Free Loan, the funds are recycled into new loans. This year, the Hebrew Free Loan has distributed more than $30,000 in loans, about half of them through the employee financial assistance program.
Although all loans are kept confidential, says Krone, occasionally borrowers will provide the Hebrew Free Loan with a signed testimonial.
One single parent of a chronically ill child calls the Hebrew Free Loan “a community haven.”
“Hebrew Free Loan is an absolute blessing,” says Shannon Lee. “Yana listened with compassion to my story about my daughter, who had been diagnosed with a chronic illness, which has no cure. She understood my needs and assured me that I was not alone, and they could help me. She worked with me quickly to get the funds that I needed to help my daughter.
“This company is a community haven. I received the money that I needed with payments that I could afford. The best part, there is no interest charged at any time whatsoever. As a single parent, this is an amazing blessing on my finances. Even more amazing however, is how supported I feel because there is no interest being charged. I have no stress over this loan.”
Krone says the Hebrew Free Loan “is changing lives one loan at a time” and that the organization is seeking to expand its capacity.