HFLA is now offering a credit building loan for those seeking to establish a positive payment history. This secured loan is for a non-negotiable $400 that will be paid in 12 equal, monthly installments. The loan dollars will not be disbursed to the borrower upon execution of the loan, but upon completion of repayment. In other words, the borrower will pay HFLA $400 before HFLA will release $400 to the borrower. If for some reason the loan is defaulted on (not paid as agreed), HFLA will return all money paid by the borrower. HFLA cannot guarantee any specific positive credit outcome for the borrower. All things being equal, the only way this loan can positively impact the borrower’s credit profile is for the borrower to make 12 consecutive, on-time payments according to the terms agreed upon in the promissory note.

In order to be eligible to apply, the interested party must first complete financial counseling with one of our partner agencies. More information can be found within the application. 

This tool is different from secured credit cards in that the debtor does not have to come up with the entirety of the credit limit at one time. As this loan is reported as a secured installment loan, it will contribute to the mix of accounts if the borrower also holds a secured or other credit card.

Upon successful completion of the loan, an additional $200 will be issued to the borrower as an emergency seed fund.