Like all 4,300 credit unions across the country, Brooklyn Cooperative Federal Credit Union is itself a cooperative, but that didn’t necessarily mean its lending team was familiar with the worker-owned cooperative structure. But, as Fernandez kept moving forward the conversation about creating a loan product for them, it didn’t take long for the credit union to realize it really wasn’t going to be much different from its existing small business lending.
Brooklyn Cooperative has long punched far above its weight as one of the most active small business lenders in Brooklyn. Now it’s simply applying that same cash flow-based small business underwriting expertise to worker-owned cooperatives.
The credit union rolled out its loan product for worker-owned cooperatives in late 2024, offering term loans and lines of credit up to $100,000 without the need for a personal guarantee. Nonprofits are also eligible to apply for the same loan product, as they also face similar situations where it doesn’t make sense for any board member or executive director to personally guarantee a loan.
“In this product, we’re not taking on any kind of personal collateral guarantee, so nobody’s really guaranteeing the loan, and there’s no personal credit review either,” says Jesus Flores, director of business services at Brooklyn Cooperative Federal Credit Union. “You still have to be able to prove that the business by itself, either with the projections or with the current income coming in, it’s able to meet the monthly payment of the amount of loan they’re requesting.”
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