Employers have a limited amount of time to give employees to recover from disaster—generally not more than a couple of weeks—because operating their businesses requires that employees show up for work. In the wake of major natural disasters, many employees lose their mode of transportation. Short-term solutions include ondemand services and rental cars, but these solutions are not cost-effective and are temporary. Mass transit is often not an option since it doesn’t go everywhere, takes more time, and is difficult to navigate if people have children. On the Road Lending’s Disaster Mobility Program is designed to get displaced workers into vehicles quickly and for the long-term.
The program’s unique characteristics that distinguish it from our other programs include:
- Deferral of programmatic requirements until clients’ lives are more stable
- Elimination of down payment requirement
- Provision for accelerated underwriting and loan approval
- Deferral of 6–12 months of principal payments (spread over the balance of the loan)
- Interest-only payments for the first 6–12 months
- Offset of a portion of interest payments so clients only have to come out of pocket $50 for the first 6-12 months (contingent upon grant funding)
On the Road Lending will provide support services to these families including:
- Collaboration with insurance companies to assist with timely settlement
- Financial coaching and support throughout the 5-year loan period
- Guidance through the programmatic requirements when lives stabilize
- Servicing of loans and reporting to funders
Risk Management:
- Because we will be accelerating underwriting and will not have the usual time to evaluate clients using our character-based lending model, we will install GPS locator devices on all vehicles.
- We will work through partner agencies, including as lead agency United Way of Greater Houston, to share case management and coordinate connecting client families with comprehensive services.
- We will establish a pop-up office in Houston, likely at United Way of Greater Houston.
On the Road Lending is working with partners, funders and board members to identify families in need, source vehicles for immediate use, and provide the capital required to implement this program. If this pilot is successful and achieves both immediate and long-term benefits, it has great potential to become a model that we can deploy in markets across the country as disasters occur.
