Championing Affordable Financing for the Disability Community
At the 2021 OFN Conference, held virtually in October, OFN awarded disability rights advocate and finance pioneer Susan Tachau the 2021 Ned Gramlich Lifetime Achievement Award for Responsible Finance.
Susan is CEO of Pennsylvania Assistive Technology Foundation (PATF), a nonprofit CDFI that helps people with disabilities and older Pennsylvanians acquire vital assistive technology devices and services.
Providing financing, education, and advocacy, PATF is a resource and champion for the 1.8 million people in Pennsylvania — and millions elsewhere — living with disabilities. Susan spoke with us about her life’s passion and call to action for the broader CDFI community.
What drew you to finance, especially related to disabilities?
My path was very personal. In February, my son, Michael, will be 40 years old. Michael was born 12 weeks early and due to complications during his birth, he has cerebral palsy. Michael is a wheelchair user. Within the first couple of months, my husband and I had to navigate access to — and the tricky task of paying for — medical care, equipment, transportation, housing… all of life’s essentials.
We quickly became very aware of the extraordinary expenses individuals and families incur because of a disability. Assistive technology alone — including adapted vans, wheelchairs, hearing aids, specialized software, adaptive sports equipment, smart home devices, and more — can be very costly and are not always covered by insurance.
For example, when Michael was 1 ½ years old, he no longer fit in the original $50 car seat we bought for him. His new car seat had to provide extra support because he couldn’t sit independently. The new seat cost $3,000 and was not covered by insurance.
And then when he was five years old, we needed to get an adapted vehicle that could accommodate his wheelchair. The total cost for the chassis and adaptations was $35,000. We could only afford this by taking out a home equity loan on our condo — the interest rate was 10 percent. We were fortunate to have this option.
For many people, especially in lower-income communities, these expenses can create high debt-to-income ratios and keep them from successfully getting credit or affordable loans.
So, you dove into finance solutions?
Yes, although not intentionally at first.
In 1989, we moved to Philadelphia for my husband’s new job at Temple Law School. And I also got a job at Temple as the director of policy at the Institute on Disabilities. I’d worked in the public policy and finance fields for ten years at this point.
Shortly after I arrived, there was an opportunity for the Institute to apply for a federal grant under the Assistive Technology Act to create an Alternative Financing Program (AFP) — a type of microfinancing program.
AFPs help people with disabilities access capital to purchase assistive technology from vendors of their choice. AFPs incorporate consumer direction and consumer control with financing models that are more flexible than a traditional bank.
The original grant to create the AFP required a match, and we found our match in PA’s Department of Community and Economic Development (DCED).
The secretary of DCED at the time, Sam McCullough, was a former banker. Because PATF was a new lender, he urged us to create a guaranteed loan fund with the state’s match so that we could leverage the additional dollars we needed from banks.
So PATF started a low interest guaranteed and non-guaranteed loan program, with interest rates that have ranged from 3.5 to 4 percent with no fees and with repayment terms based on the useful life of the device. Most of these loans are unsecured — only vehicle and home equity loans are secured.
Several years later, PATF created a direct Mini-Loan program for unsecured loan amounts ranging from $100 to $2,000 at 0 percent interest, with no fees and repayment terms of up to three years. In response to the pandemic, early this year we increased that threshold to $7,000 and extended the repayment terms up to four years.
In 2012, we were certified as a CDFI.
What has PATF’s impact been?
There were some skeptics in our early days as a CDFI — we heard that our loan programs would not be sustainable.
But here we are today: PATF has helped more than 15,000 people with disabilities access assistive technology with low and no-interest loans and connections with grant funding. We’ve extended more than $44 million in low-interest loans to Pennsylvanians with disabilities and helped thousands more access assistive technology with information and educational support.
Our overall loan default rate is very low at 1.8 percent. It’s that low because PATF does what all CDFIs do: we get to know our clients; we lend to people, not a credit box. And it has been our experience that people with disabilities do not default on loans for equipment that helps them live in their own homes, or communicate, or get around in the community, or connect with other people, or work, or go to school.
We also report the repayments to Credit Builders Alliance, who, in turn, reports to Experian, TransUnion, and Equifax, which helps our borrowers build positive credit.
Tell us about PATF’s reach outside of Pennsylvania.
We do much more than financing. We offer comprehensive information about other funding options for assistive technology, as well as financial education through our disability-focused curriculum, Cents and Sensibility: A Guide to Money Management, available in print and online, in English and Spanish. In fact, earlier this year we launched an interactive financial education website, StudyMoney.us, and we have had users from all 50 states and more than 80 countries.
Our most recent innovation is our smart home technology project, where we’re building awareness about how smart home technology can help people with disabilities and older adults live safely and independently in their own homes. We’ve written a guide and created an engaging website that serves as an information hub for people to learn how to integrate these devices into their lives.
In addition, we have provided technical assistance to more than 40 AFPs and CDFIs across the U.S. to help them create programs and expand their capacity to serve people with disabilities.
Earlier this year, we incorporated Appalachian Assistive Technology Loan Fund, a subsidiary of PATF, and are waiting for CDFI certification for this organization as well. We hope that within a year, we’ll be able to extend consumer loans to people who live in the Appalachian region (where there isn’t an AFP) so that they, too, can afford vital assistive technology.
We also work closely with the National Disability Institute, the National Disability Finance Coalition, and the National Council on Independent Living.
What do you want the broader CDFI industry to know about your work? Do you have a call to action for the industry?
I want the 60 million people living with disabilities — the largest minority group in the U.S. — to be seen and heard and included in all sectors and industries, including finance.
Most of us know someone who has a disability — someone who has cerebral palsy or is blind or is hard-of-hearing or has MS, ALS, a spinal cord injury, an intellectual disability, or a brain injury. The disability community intersects with all communities — Black, Indigenous, People of Color as well as LGBTQ+.
This vibrant community deserves opportunity and inclusion in financing products and services and as employees in CDFI offices.
I encourage all CDFIs to get to know the National Disability Finance Coalition. Learn how to build the disability community’s needs into your financing. Help your borrowers understand accessibility for their projects, businesses, employees… Get to know the most current resources and guidelines available.
What does it mean to receive this award?
It is my belief that if you find something you really care about, it will fuel you. This work has been my life’s calling and passion. And the Gramlich Award is an honor for me and our PATF team. It signals that our work matters, that people with disabilities matter.