by Len Lear
“We offer interest-free loans, both personal and for businesses! You have to pay back the principal, but there will never be one penny of interest on the loan!”
Let’s face it. If you saw that ad in a newspaper, on TV or the internet, what would be your first thought? Ripoff; scam; deception. There must be a hidden agenda, hidden costs; one way or another, you are going to be exploited, taken advantage of, have your credit ruined, etc.
Well, as hard as this is to believe, there actually is an organization in the Philadelphia area which has been providing interest-free loans to area residents for 30 years but has been operating pretty much under the radar; otherwise, everyone would know about it.
“All of our funds are from donations. There’s no government funding,” explained Jonathan Harmon, a long-time resident of West Mt. Airy (with his wife, Martha Lask) and part-time executive director of the Hebrew Free Loan Society of Greater Philadelphia. “Because we provide loans, not grants, the money comes back and can be lent again. We make 40-50 loans most years, though we have funds to make quite a few more. Finding borrowers is actually one of our biggest challenges.”
On Wednesday, Sept. 10, the Hebrew Free Loan Society of Greater Philadelphia (HFL) will celebrate its 30th anniversary by honoring its founders, including a special tribute to Rabbi Aaron Landes, who died on April 19 after 36 years of service to Beth Sholom Congregation. Former Philadelphia Mayor and Pennsylvania Governor Ed Rendell will speak at the event, as will Brad Gellman, a photographer who borrowed from the organization to launch his photography business, and Masha Lipkovsky, who borrowed from the society to pay for education expenses and was recently approved for one of the organization’s first business loans in order to open Unik Cakes.
According to Rachel Ezekiel-Fishbein, who does public relations for HFL, “Hebrew Free Loan Societies draw upon Jewish law prohibiting Jews from charging interest to each other. Chapter 22, verse 24, of Exodus reads, ‘If you lend money to My people, to the poor among you, do not act toward them as a creditor; exact no interest from them.’”
HFL of Greater Philadelphia is one of more than three dozen HFLs in the U.S., and serves a nine-county region including Philadelphia, its suburbs and South Jersey. In the 30 years since its founding, the organization has granted more than 1,400 loans totaling close to $3 million. Its maximum loan amount is $7,500, and recipients have two to three years to pay back the money with no interest or fees.
“Historically, when Jews settled in a new place, the first thing they built was a mikveh, and the second was the Free Loan Society,” said Marshal Granor, co-president of HFL of Greater Philadelphia. “The practice originated in Europe, where the Rabbi and Rebbetzin served as the interest-free lender. Dignity is critical to the concept. Once a week the men of the congregation would line up. One by one, they’d walk into the Rabbi’s office and close the door. There’d be a jar of money on his desk. Each man would add to it, take money out or do nothing. That way, no one had to know who was in need.”
During the immigrant era, individuals would borrow $25 to purchase a pushcart or a sewing machine to start a business. Like today’s borrowers, they did this free of interest and paid it back over time.“Our loans are often sought by individuals who have hit a bump in the road, such as losing their job or a medical emergency,” explained Tamar Granor, who, alongside her husband, is co-president of the society.
Marshal Granor’s parents were central to the founding of Philadelphia’s HFL. In 1984, they became empty nesters in search of a project. Rabbi Landes, whose mother had run HFLs at the two Massachusetts congregations where her husband officiated, suggested that our area could use an HFL. With the support of 12 other families, all of whom are being honored at the event, the organization was born. Two of the founders of the local HFL, Madlyn and Leonard Abramson, held a fundraiser at their home to raise the initial capital of $60,000.
Fred Wolfson, of Wyndmoor, whose father, Jules, was one of the founders of HFL, began working for HFL after Jules died in 1990. “My dad’s motivation (in founding HFL),” Fred told us, “was how he lived — to help those unable to help themselves.”
According to Jonathan Harmon, “For personal loans, which we’ve been giving since 1984, borrowers must be Jewish or have a connection to the Jewish community such as working for a Jewish communal agency. The maximum personal loan is $7500, and the number of co-signers depends on the size of the loan; the maximum is three. Borrowers have two to three years to pay the loan back in equal monthly payments; the exact payment schedule varies with the amount of the loan.”
HFL also recently launched the R&B Business Loan Fund at Congregation Beth Or in Ambler, providing no-cost, no-interest loans up to $15,000 on a non-sectarian basis to new and changing area businesses. Both types of loans do require credit-worthy co-signers to guarantee repayment.
Are there ever any loans that are not paid off? “Unfortunately, yes,” Harmon told us last week. “While the vast majority of our borrowers pay off their loans as scheduled, in some cases we have to call on the co-signers to pay. In very rare cases, we have to take legal action. Overall, though, our repayment rate exceeds 95%.”
This reporter contacted two local individuals who have borrowed money from HFL to ask about their experiences, but they did not reply to messages that were left.
For loan inquiries, call 267-709-9652 or visit firstname.lastname@example.org