This story was corrected at 1:10 p.m. on July 7, 2014. An explanation follows the story.
Archer Chapin started his business, Apartment Angel, the same year he started high school. Since then, the rising senior at Georgetown Preparatory School in Bethesda has been getting an education most of his classmates haven’t — with daily lessons in the world of real estate and finance.
Apartment Angel is a nonprofit that issues no-interest loans to apartment renters who are facing eviction.
“There are a lot of good renters out there that lose their jobs, or experience some hardship, and are unable to pay the rent for one month or so,” Chapin said. “Apartment Angel lifts these great renters back onto their feet by paying one month’s rent, which is then repaid through an interest-free loan. The resident’s rent is paid directly to the apartment property, ensuring that the donation is used specifically for the rent.”
The idea for Apartment Angel came to Chapin during a conversation with his father, Stephen Chapin, the founder of Jars LLC, a development firm that works with insurance companies. Jars buys, sells and manages apartments in Savannah, Ga., and Charleston, S.C.
In September 2012, Chapin spoke with his father about a renter who was being evicted. The woman had been a solid tenant for three years, but had unexpectedly found herself in financial trouble.
“I was asking questions like, ‘Well, there’s nothing you can do? Because it seems like if you help that person for one month, then they’ll be able to stay in,’” Chapin said.
Shortly thereafter, Chapin launched Apartment Angel with Executive Director Steve Bucklin, his father’s former associate and friend. They used money from Jars for the company’s first loan.
“When we were first getting started, Jars helped by providing the funds for our loans, but now we’re a completely separate entity,” Bucklin said. “They were our first donor.”
Since its founding, Apartment Angel has issued about 50 loans and has a 75 percent payback rate.
“It’s a free-will loan, so it’s up to the individual to repay it,” Bucklin said. “Sometimes, people can’t do it in five months, so it will take them longer. We just try to work with people.
“People want to pay back, so just being flexible with how and how long it’s going to take is key. There’s no impact on their credit or paperwork or anything, but most of the time, they want to pay back. We send out reminders once a month reminding them that their time to pay back is coming up.”
The loans average $750 to $800. The money for the loans comes from a mixture of payback from previous loans and donations. Because of the cycling of money, every $1 donated has $4 in helping power, Chapin said.
So far, Apartment Angel has received four donations, including one for $1,000 from Berkeley Point Capital of Bethesda, which provides loans for apartment owners. Other donations have come from apartment managers and owners themselves who have personal connections to the cause.
Borrower applicants must have a legitimate reason for not being able to pay, such as a job loss or a medical condition. They also must have a history of timely rent payments. To gauge the renter’s reliability, Apartment Angel contacts property managers and asks their opinion.
“We leave a lot of the decision up to the apartment manager’s discretion,” Chapin said. “They know whether the loan will be paid back depending on how the resident behaves.”
Chapin said he thinks his company’s mission is important because evictions are costly and difficult for both the property managers and tenants.
“It helps both the renter and the apartment owners to avoid eviction because it costs a lot to evict a resident,” Chapin said.
Apartment Angel’s immediate goal is to provide 500 loans and raise $200,000 by the end of the year.
“We wanted to set a bold target,” Bucklin said. “We’ve been successful in helping people. The model is looking good.”
While 500 loans is just a goal, Chapin predicts that it is doable.
“We’re seeing interest that would allow it to do that by the end of the year,” Chapin said.
Right now, the focus is on the Southeast, but Chapin and Bucklin envision the company eventually going national.
“What I’d like to do is to get us to be a national company in the next two to three years, where we have partner companies all over the country and we’re hopefully helping a couple hundred people a month,” Bucklin said.
He and Chapin hope to partner with the Maryland Multi-Housing Association, a trade association for property owners.
Andrew Bonic, director of government affairs for the Maryland trade group, said his association is reviewing Apartment Angel’s partnership proposal.
“Archer just recently reached out to us and we have put together a small committee, independent of him, to try to figure out if and how we can provide some sort of help in terms of the renters who are facing eviction,” Bonic said. “We have formed a committee and we are brainstorming ways to make the relationship work.”
More information about donating or helping the nonprofit is available at apartmentangel.org.
An earlier version of this story had an incorrect attribution for Andrew Bonic’s comments from the Maryland Multi-Housing Association.