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I. The Pennsylvania Assistive Technology Foundation (PATF or "Foundation") Program
The Foundation’s basic purpose is to operate a low-interest loan program for people who need to borrow money to buy needed assistive technology devices and services. The program also has a guarantee component for borrowers who require additional support. The guarantee monies operate as a revolving fund. As guaranteed loans are repaid, equivalent amounts from the fund are freed up to guarantee new loans.
The Board’s current interest rate of 3.5% is available to all borrowers and reflects the Boards’ commitment to offer loans that are attractive and affordable. Every six months, the Foundation negotiates with its lender, Sovereign Bank, to buy-down the interest rate from the Bank’s prime rate to our rate of 3.5%. The buy-down rate ratio is then applied to every approved loan.
In addition to the low-interest loan aspect of the program, the Foundation has made a commitment to serving people who are traditionally not considered "credit worthy". For example, an applicant with a Beacon score below 600 and a debt-to-income ratio greater than 35% will not normally qualify for financing. For these borrowers, our lender will ask us (the PATF) to guarantee the loan. When this occurs, the Foundation’s Board of Directors reviews the application and votes on whether to approve the guarantee. In making its determination, the Board considers the nature and extent of an applicant’s credit problems as well as the total dollar amount of the loan requested. After this review, if the Board believes that the applicant does have the ability to repay the loan, it will award the guarantee. [Note: The guarantee is a dollar for dollar match.]
The Foundation’s policies allow applicants who are found to be credit-worthy (meaning they do not need a guarantee) to borrow the full amount requested. However, there is a $25,000 limit for loans that require the matching guarantee as well as a $500 minimum on all loans.
The Foundation also helps ensure that borrowers maximize their ability to repay their loans while building a good credit history. The Foundation offers consumer credit counseling throughout the application and loan process. To begin, when an application is being reviewed, potential borrowers are asked whether they have tried particular public funding sources that may be available. If not, specific contact information is given to the applicant. After a loan has been made, if the borrower runs into trouble repaying his or her loan amount on time, the Foundation has the option of offering to make rescue payments (from one to three monthly payments made by the Foundation with the amount paid tacked onto the full loan commitment at the end) and/or referring the borrower to a credit counselor.
PATF has a contract with Consumer Credit Counseling of Southwestern PA (CCC of SW PA) to offer up to three 60-minute telephone-counseling sessions with each borrower. The sessions are designed to help a borrower keep track of his or her bills and create a workable budget. If, after three sessions, it appears the borrower needs additional assistance, the borrower may be referred to the Debt Management Program. Again, the Foundation pays CCS of SW PA for these services that will help borrowers make their payments on a timely and regular basis.
The Foundation has a toll-free telephone and TTY number so that consumers from across Pennsylvania can get the information they need about our programs. However, PATF has found that some people prefer to talk to people in their local area. As a result, PATF has contracted with 9 Funding Assistance Centers throughout the entire Commonwealth.
The Funding Assistance Centers are charged with outreach and promotion of the PATF, as well as offering some funding assistance. Consumers are offered information about other possible funding sources for the requested assistive technology device or service, and they are offered information about the Foundation. The Funding Assistance Centers are also trained to begin the application process, after which they forward all materials to the Foundation office (by phone, fax, e-mail, or mail) for financial verification. All Foundation staff, Funding Assistance Center staff and the Board of Directors for the Foundation have signed confidentiality statements in order to protect the privacy rights of applicants.
The agreement between the Foundation and its bank, Sovereign Bank, allows for all transactions to take place via mail or e-mail. This is a great service for our applicants. However, before the final loan documents can be processed, applicants must have their signature notarized. Unfortunately, for some consumers finding a notary, making an appointment and then getting to the appointment can be a difficult process. As an experiment, the Foundation is investigating a way to simplify this process for borrowers. The Foundation’s Program Assistant has become a notary and is offering her services to the applicants who live in the 5-county, southeastern region of Pennsylvania. Thus far she has assisted several consumers in completing their loan process.
In reviewing the current PATF loan program, the Board of Directors is committed to continuing its efforts to ensure that the program is affordable and accessible to all older Pennsylvanians and to those who have disabilities. This means a commitment to buying-down the interest rate so that it is affordable; it means having a guarantee pool large enough so we are able to service all those people who require the match in order to access a loan; it means offering consumer credit counseling so that borrowers can maintain their good credit standing or build up a solid credit history throughout the life of their loan; it means offering rescue payments as a short-term remedy to help those who have met with unexpected difficulties in making timely loan repayments; and it means being insightful and offering new services (such as notary services) that can assist in the accessing of loans. The goal of the Foundation is to provide low-interest loans to people so that they can buy the assistive technology devices and services they need, and in doing so, help a person achieve a more independent and productive life.
Assistive technology is defined in the Technology-Related Assistance for Individuals with Disabilities Act of 1988 (renamed the Assistive Technology Act in 1998) as devices and services that help to increase, maintain, or improve the functional capabilities of individuals with disabilities and older residents.
An assistive technology device is "any item, piece of equipment, or product system whether acquired commercially off the shelf, modified, or customized" that accomplishes the goal of increased functional capabilities. Examples include home modifications such as grab bars and ramps, vehicles with adapted steering controls or wheelchair lifts, " reading" machines, a microwave oven (for someone who cannot use a conventional oven safely), computers with adapted software and/or hardware, and voice output communication devices.
Assistive technology services directly assist an individual with disabilities in the selection, acquisition, or use of an assistive technology device. These services include: evaluation of needs, selecting, designing, fitting, customizing, adapting, maintaining, or repairing devices; coordinating other therapies or services with assistive technology training or providing technical assistance for individuals with disabilities, family members, and other individuals who provide services for the individual who has disabilities. Examples of services include installation of adapted steering controls in a vehicle, lowering of kitchen counters, training in use of adapted software, or customization of a motorized wheelchair.
Assistive technology enables people with disabilities and older Pennsylvanians to become more independent, more productive, and more included members of their communities.
Beacon Score is a standard rating technique used by lending institutions to evaluate the probability that a particular borrower will be able to repay a loan and is based on a number of factors, including payment history, outstanding debt, credit history, types of credit in use, and new account openings.
Co-applicant/co-signer is an individual who shares legal responsibility for repayment of a loan with the applicant.
Creditworthy individuals, as defined by lending institutions, are individuals with a good credit history and no unfavorable credit problems, or an individual who is actively addressing his or her credit problems in a positive way.
Debt is defined as the monthly mortgage/rent payment, monthly payments for existing loans including credit cards, alimony or child support obligations, and the monthly payment for the requested loan through the Pennsylvania Assistive Technology Foundation.
Debt-to-income ratio is defined as the relationship of an applicant’s monthly debt to his/her monthly income. The PATF will allow loans up to a maximum of 50% debt-to-income ratio if the borrower can adequately document sufficient cash flow to make loan payments.
Delinquent account is one in which one or more monthly loan payments have not been made by the due date.
Eligible individuals include people with disabilities or older adults who are residents of Pennsylvania and need assistive technology may apply for a loan. Family members may apply on behalf of children or other family members with disabilities, as well as advocates, guardians, and authorized representatives as long as the device or service is for the use by the person with disabilities. Approval for a loan is based on an applicant’s ability to repay the loan.
Family member is defined as a parent, sibling, spouse, significant other, son, daughter, grandparent, aunt, uncle, cousin, legal guardian or legal custodian. The family member does not necessarily live with the individual with disabilities. The term also includes a person providing foster care or a family-living program home.
Funding Assistance Centers (FACS) are ten agencies that represent all geographic areas of the Commonwealth. The Funding Assistance Centers’ staff will provide consumers with information about the range and scope of assistive technology, funding opportunities within Pennsylvania, information packets about PATF loan program, assistance with completion of the application, etc. Funding Assistance Centers also assist with promotion and outreach activities for the Foundation.
Income is defined as all wages, salary, commissions, interest, pensions, and other sources of financial support such as employment-related disability benefits, Supplemental Security Income (SSI), Social Security Disability Income (SSDI) and Social Security retirement benefits.
Lending institution is a bank that has agreed to make loans to qualifying borrowers and has signed an agreement with the Pennsylvania Assistive Technology Foundation specifying rates and terms.
Loan guarantee is a legal commitment by which the PATF is obligated to pay the outstanding balance of a loan including interest, if a borrower fails to make loan payments for more than 90 days.
Individuals with disabilities are those individuals who self identify a limitation to one or more major life functions, such as walking, talking, hearing, seeing, taking care of oneself, and learning.
A qualifying borrower is a person who demonstrates the ability to repay a loan by meeting the criteria established by the PATF in relation to Beacon scores, debt-to-income ratio, a consistent payment of bills and debts during the previous 12 months.
A resident is a person whose legal residence is within the Commonwealth of Pennsylvania.
III. General Loan Guidelines
A. Loan Amounts: Applicants who are found to be credit-worthy can borrow the full amount requested. However, there is a $500 minimum on all loans as well as a maximum of $25,000 for loans that require the guarantee.
B. Loan Periods: The period of a loan is based on the expected useful life of
the assistive technology device to be purchased.
Typical repayment periods for various types of loans are shown below:
Note: Used vehicles will be considered if the vehicle is no more than five years old and has 50,000 miles or less.
If the PATF has not established a loan period for a specific type of assistive technology device, staff will consult with knowledgeable individuals to determine the expected useful life of that type of assistive technology.
NOTE: Additional considerations for purchasing of a vehicle: If modifications are required to a vehicle, the applicant must be the vehicle owner or a family member. If a third-party payer will be providing the modifications, the applicant must provide documentation that it is approved (i.e., a letter from the Office of Vocational Rehabilitation).
Family members may own a modified vehicle that is being purchased to transport a family member who has a disability. The driver must provide proof of insurance and a copy of his/her valid PA driver’s license.
Considerations for home modifications: In a situation where an individual can obtain funding under a third-party payer, but it is a reimbursement model, he/she may be eligible for a loan. In the event that someone is able to do or obtain free labor to complete his/her home modifications, he/she may be eligible for a loan to purchase the necessary supplies.
C. Allowable Equipment. The PATF will facilitate loans to purchase a broad
range of assistive technology. Examples include, but are not limited to, the following:
Braille note takers
Assistive listening devices
Augmentative communication devices
Electronic aids to daily living
Visual aids with voice output or magnifying features
Computers and adaptive peripherals
Home modifications for accessibility
Motor vehicles that have been adapted or need adaptations
D. Loan Restrictions – The Pennsylvania Assistive Technology Foundation provides low-interest loans only for the purchase of assistive technology devices and services. Therefore, the PATF will not process loan applications to pay off existing loans, to pay for an item that the applicant already possesses, to rent an item or to purchase a home. The PATF will provide loans for home modifications to rental units only with the written approval of the rental property owner.
A. Initial Contact. When a consumer contacts the PATF or a Funding
Assistance Center, staff will review the individual’s needs and assist him/her in determining if a loan is the best option. Staff may offer such services as information and referral, i.e. recommend other possible funding sources or refer to Pennsylvania’s Initiative on Assistive Technology for funding assistance.
If the individual decides to apply for a loan, the staff will send an application packet. The packet will contain a loan application form, an instruction sheet, information regarding consumer credit counseling, and a "privacy rights" handout.
B. Application. The PATF loan application is similar to a standard consumer loan application form. However, there are a few additional questions attached to the application, such as type of disability and type of assistive technology to be purchased with the loan.
The PATF does not ordinarily ask for proof of disability. However, the Board may, on occasion, ask the applicant to provide an explanation as to how the needed device meets the federal definition of assistive technology, if it is not readily apparent. (Example: The Board of Directors may ask for such an explanation if an applicant requests a loan for a computer without also seeking to buy adapted peripherals or specialized software.)
C. Application Completion. Consumers can receive application packets by calling or writing the PATF or a Funding Assistance Center. The PATF and the Funding Assistance Centers staff will offer any assistance needed to complete the application forms. All applications received by the Funding Assistance Centers will be mailed to the PATF within two business days.
D. Initial Application Review. Upon receipt of an application, the PATF staff will assign a case number to the application in order to maintain confidentiality and will perform an initial review to verify that the applicant is seeking a loan for assistive technology for an individual with a disability. Additional information to verify the need for and appropriateness of the assistive technology may be requested from the applicant.
The PATF staff will then forward the loan application to its participating bank. The bank will make a loan decision based on the terms and conditions as agreed to with the PATF. The bank will either approve or disapprove the application, and report the decision to the applicant in writing with a copy to the PATF.
Should the bank not approve an application, it will send an adverse action letter to the applicant and notify the PATF. The PATF will notify the applicant informing him/her that his/her application will be forwarded to the Board for consideration of the application as a guaranteed loan.
E. Board Review of Applications Not Approved by the Bank. The Board will review all applications that have been denied by the bank as a traditional loan to determine whether or not to guarantee the loan. If the Board approves access to the guarantee for a loan, the PATF staff will notify the borrower of its decision in writing or in an appropriate alternative format.
If the Board decides not to provide a guarantee, it will send the applicant an adverse action letter, which outlines the reasons for its decision. The letter may offer an alternative to the applicant such as re-processing the loan with a qualified co-signer.
At its discretion, the Board may require co-signers or other measures to approve loan guarantees for applicants whose financial resources do not indicate ability to repay the loan. Upon satisfaction of all conditions, the PATF staff will notify the lender that the board has approved access to the loan guarantee for the specific application. This action obligates the PATF to pay off the outstanding balance including interest if the borrower defaults, according to the terms of the agreement with the participating lender.
V. Guidelines used by Board of Directors in Reviewing Access to Guarantee
The PATF does not discriminate because of race, color, sex, ethnic origin, religion, sexual orientation, disability or age. All borrowers are treated fairly and according to the same standards.
While the PATF’s criteria for approving access to the guarantee are more flexible than the loan criteria of all banks, the Board needs to have a reasonable expectation that the borrower will repay the loan.
The three most important criteria for a PATF loan are credit history, debt-to-income ratio, and capacity to repay. When the applicant has a history of credit problems, the applicant must be able to demonstrate that he/she has a workable plan to deal with those problems. A pattern of adverse credit actions that cannot be adequately explained and has not been adequately dealt with will result in a decision not to guarantee a loan. Similarly, an applicant who does not have adequate cash available to pay for a new loan after taking care of other financial obligations will not be approved for a loan.
Generally, the PATF Board looks for a pattern of stability in its loan applicants in areas such as type of residence, length of time at residence and length of time at present job. It is also looking for a pattern of responsibility with respect to credit history.
VI. Standards and Criteria For the Loan Program
The following chart outlines the standards that the Foundation follows in administering the PATF loan program. These standards may be reviewed and revised from time to time in order to comply with state and federal requirements.
VII.Additional Loan Information
A. Insurance. The cost of insurance for a vehicle or other type of assistive technology device may be included in the loan request.
B. Maintenance, Repairs and Upgrades. The qualifying borrower will be responsible for all repairs and maintenance of the equipment unless these costs were included in the loan application. The costs of repairs, extended warranties or maintenance agreements to previously-owned assistive technology devices are allowable if they meet other terms of the PATF criteria.
C. Joint Check Issuance. PATF may require that loan proceeds be payable to the borrower and the supplier/ vendor of the assistive technology device or service.
D. Deadline for Loan Closures. When approved for a guaranteed or non-guaranteed loan, the applicant must close the loan with the participating lender within thirty (30) calendar days of the date of approval. Applicants who have not closed their loans within the thirty day period will need to re-apply.
VIII. Late Payments and Defaults of Guaranteed Loans
A. Monthly Reports. Each participating bank will provide a monthly report to the PATF documenting the following data for all loans approved through the program, with separate sections for guaranteed and non-guaranteed loans:
B. Collection Procedures. Each participating bank will follow its normal collection procedures for all delinquent loans. Upon notification or through monthly reports on active guaranteed loans, the PATF will keep track of 30, 60 and 90-day late loans in an attempt to resolve payment issues and to prevent defaults. The PATF will contact the borrower directly, particularly if the loan is guaranteed. The PATF may make one to three monthly loan payments on behalf of the borrower if there is an extenuating circumstance that warrants such a payment by the PATF (i.e., rescue payments). The borrower will be expected to reimburse the PATF for any such payments.
C. Defaults. The PATF will assume responsibility for any guaranteed loan that becomes more than 90 days delinquent. The PATF will pay off the outstanding balance of the loan plus interest.
A borrower who has defaulted will be informed that the PATF has paid his/her loan, detail the amount paid, and notify the borrower that s/he is expected to repay the PATF. The PATF may also refer the loan to a collection agency.
IX. Appeal Procedure
Any applicants may petition the PATF Board for reconsideration of the application if s/he does not agree with the board’s decision to deny the guarantee. The petition must be received by PATF within 30 calendar days of receipt of the written denial. The applicant should include a statement to the PATF Board explaining the reasons he/she feels that reconsideration is warranted. An appropriate alternative format may also be used.
The PATF Board will:
1. Review the applicant’s statement;
2. Consider any new information;
3. Inform the applicant of its decision in writing or via other appropriate alternative format within ten (10) days of receipt of the notification of appeal.
Adopted by the PATF Board: January 16, 2002
Revised: February 6, 2003
September 17, 2003
1700 North Moore Street, Suite 1540
Arlington, VA 22209-1903
Phone: 703/524-6686 Fax: 703/524-6630 TTY: 703/524-6639
Email: firstname.lastname@example.org http://www.resnaprojects.org/AFTAP