Loan programs benefit Native Hawaiians

LIHUE — Native Hawaiians on Kauai have received nearly 5 percent of the total number of Malama Loans awarded since the Office of Hawaiian Affairs launched the lending program for education, business and home improvement in 2007.

All told, 2,017 Malama Loans totaling $37.4 million have been distributed to qualifying Native Hawaiians across the islands. Kauai residents account for 101 of those loans, totaling $1.9 million, according to Native Hawaiian Revolving Loan Fund Finance and Operations Manager Thomas Atou.

Atou presented this information in a status report to the OHA Board of Trustees Wednesday at the agency’s annual Kauai and Niihau community meeting at Wilcox Elementary School.

“Our financing is to support those who are in need of financing to help either with their business growth, prepare for their house to improve equity, improvement with education loans and to help consolidate their debt so they have more cash flow,” Atou said.

The program makes up to $19,999 available to qualified applicants, whose interest rate on the loans is 6.25 percent. To start or expand a business, the interest rate is 4 percent. The repayment period on the loan is seven years.

Of the Malama Loans awarded since April 30, 39 percent funded home improvements, 29 percent went toward debt consolidation, 24 percent were funneled toward businesses and 8 percent supported education, Atou said.

“The loans that we give out we hope to recover to keep the revolving door aspect of this going,” Atou said.

The money for the Malama Loan program comes from the NHRLF, which is administered by OHA through First Hawaiian Bank. NHRLF was created in 1987 as a self-sustaining program with repayments used to generate new loans for Native Hawaiians. The goal of NHRLF is to provide alternative funding to borrowers often denied traditional loan products and to provide these loans at rates and terms not available from other sources.

Native Hawaiian consumers and businesses can apply for the loan at First Hawaiian Bank. Eligibility requirements include U.S. citizenship, Hawaii state residency and Native Hawaiian ancestry.

In addition to Malama Loans, OHA opperates two other lending programs. The Consumer Micro-Loan Program makes up to $7,500 in low-interest loans available to Native Hawaiian consumers experiencing temporary financial hardships due to unforeseen circumstances.

The Hua Kanu Business Loan Program makes between $200,000 and $1 million available to help Native Hawaiians expand their already established businesses.

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