Chautauqua Home Appliance Loan Program

Chautauqua Opportunities for Development Inc. (CODI) began offering home appliance loans to provide clients with an alternative to rent-to-own businesses at an affordable interest rate.

Chautauqua Opportunities for Development Inc. (CODI) and its parent organization Chautauqua Opportunities Inc. are dedicated to ending poverty by mobilizing resources and creating partnerships to promote empowerment, economic independence, and opportunity in Chautauqua County, New York. CODI realized it could leverage its microenterprise loan program to also meet the needs of COI's low-income target by offering appliance loans. The loan product offers an affordable alternative to rent-a-centers, which, with their high rates and strict repossession policies for customers with any late payments, were threatening the financial stability of many county residents. Since the launch of the appliance loan product in April 2007, the program has made 43 loans for a total of $48,114 in loan dollars disbursed.

Loan clients can borrow money for one or more needed appliances, such as refrigerators, washers, dryers, stoves, and air conditioners. CODI purchases the new appliances from a local vendor that delivers and installs the appliance in the client's home. The invoice for the product goes directly to CODI who pays for the product and the client pays off the appliance loan monthly. A landlord waiver is included as part of the loan. The waiver clarifies that CODI can repossess the appliance if the borrower defaults on their loan and that CODI, not the landlord, has first claim on the appliance if the borrower does not fulfill their apartment lease agreement. With the loan, borrowers receive one-on-one credit counseling and are also referred to CODI's financial literacy classes.

Participants in the home appliance loan program tend to be very low-income and to have poor credit histories. They are clients like Annie, a single mother who works three jobs to provide for her children. She did not have a stove or a refrigerator in her home and was cooking on a hot plate and storing all her food in a cooler. Because of this, her children were at risk of being removed from the home by the state protective services agency. With an appliance loan from CODI, she has been able to get a refrigerator and a stove in her home and keep her children. Or Jenny, who in her sixties, is the primary caretaker for three adult siblings with mental handicaps. She did not have a washer or dryer and washing all the household's clothes by hand. Through CODI, she has been able to get a washer and dryer and reduce her workload significantly.

Most clients find out about the home appliance loan program by word of mouth or through COI's intake process, which screens new clients for a variety of programs and services. Credit history is considered as part of the loan application, but bad credit does not disqualify an applicant. CODI considers the loan, which is reported through CBA, not only as an alternative to high cost buy-here-pay-here options, but also a good opportunity for low-income clients to build or re-build a positive credit history.

Chautauqua Opportunities Inc. is a community-based agency providing housing, health, education, family support, and economic development services to low-income and at-risk residents of Chautauqua County, New York. The agency works to end poverty by mobilizing resources and creating partnerships to promote empowerment, economic independence, and opportunity, and serves approximately 45,000 county residents each year. COI's economic development services are delivered through an affiliate corporation, Chautauqua Opportunities for Development Inc. (CODI). CODI is a CDFI (Community Development Financial Institution ) that offers housing counseling, credit counseling, microenterprise lending and technical assistance, individual development accounts (IDAs), and a business incubator space and services.