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Maritza Guerrero, owner of New York Dominican Beauty Salon, works on the hair of Francisca Ventura at the salon’s Windsor Mill location. Guerrero received a $5,000 loan from the Latino Economic Development Center to help offset the revenue she lost during the rioting and unrest in Baltimore. (Photo by Maximilian Franz / The Daily Record)

Help in any language: Nonprofit offers loans to minority business owners

On a good day of business, Maritza Guerrero can get as many as 30 customers in her Baltimore-area salons. During April’s riots, however, about half of her customers stopped showing up.

“Those days were scary for us, all the business owners,” Guerrero said recently at her New York Dominican Beauty Salon in Windsor Mill.

Guerrero’s 5-year-old chain of salons, with locations also in Randallstown and Highlandtown, specialize in Dominican hair care, with shampoos made of natural oils imported from Italy.

“For us (Dominicans), this is an important thing,” she said.

But the money Guerrero lost in April made it difficult for her to pay her salon’s rent and maintain its inventory. So she turned to the Latino Economic Development Center, which created the Baltimore Recovery Loan Program to help businesses such as Guerrero’s affected by the riots bounce back.

New York Dominican Beauty Salon is among seven businesses that have received recovery loans from the program so far. The center is offering $5,000 loans with 6 percent fixed interest and a two-month grace period before the first payment is due.

“For most small businesses this isn’t going to save or turn around a business. This is something we thought would help normalize cash flow,” said Eric Lin, small business coach and trainer at the center’s Baltimore office.

The center wants to give out between 15 and 20 loans by the end of the year.

“This is really need-based so we will provide loans to anyone who needs (it),” Lin said.

Guerrero heard about the loan program through the Highlandtown Business Association.

“They were very nice,” she said about the process. “Almost like getting a loan from an uncle or grandpa.”

The center also provides technical assistance to businesses, including planning, navigating legal requirements and formally registering businesses with the state. Guerrero, for example, also got accounting and marketing tips from the center.

Language barrier

The Washington, D.C.-based LEDC was formed in the aftermath of the Mount Pleasant riots in Washington to create economic opportunities for Latinos. The center focuses on affordable housing and small business services in its Washington and Wheaton offices, while the Baltimore office focuses exclusively on small business services.

Language is one of the largest barriers immigrants starting a business face, Lin said. While the federal government offers translation services, people often don’t know about them, which points to another problem: lack of access to information. Most websites and forms are in English.

All employees at LEDC are bilingual and the organization serves a variety of ethnic groups. Latinos made up 50 to 60 percent of the center’s beneficiaries last year while African Americans made up 20 to 30 percent and whites made up 10 percent.

Cultural differences are also a factor. Small businesses in other countries often don’t need to deal with government agencies, Lin said, while fire codes and health codes are unfamiliar concepts.

Freddy Guevara, for example, ran an HVAC business in his native Venezuela for 20 years. When he moved to Silver Spring six years ago, he wanted to continue his business.

“I did not how to start,” Guevara said. “It’s not my language.”

LEDC helped Guevara register his business and gave him a loan. Guevara now has a loyal customer base who call him whenever they have a problem with their air conditioner or refrigerator, he said.

“I’m independent now,” he said.

As a community development financial institution, the center doesn’t have a minimum credit score requirement but it still does risk assessments. An applicant’s bank statements, personal and business taxes, bankruptcies and character are all considered.

“Our loans are really a community service,” Lin said.

Loans typically range from $5,000 to $50,000 for 60-month terms with interest rates ranging from 8.75 percent to 14 percent.