Allentown Economic Development Corporation
610.435.8890

PMBDA loan helps Allentown insurance agency grow

When Rafael De La Hoz came to America from Colombia in 2004, he never envisioned he’d live in Pennsylvania and become a successful businessman in a city called Allentown, which he had never heard of before. Yet today he is living the American dream as the head of a successful State Farm agency in the Queen City.

A recent Pennsylvania Minority Business Development Authority loan is allowing him to take his business to the next level by purchasing an office building down the street from where his office is currently located on the city’s south side.

Time to grow

De La Hoz knew he needed a bigger office space, but at first, he wasn’t interested in buying a building. After looking at rents in the area and checking out a few places, he identified a property for sale. The 2,300 sq. ft. building on 4th Street is in a high-profile location across from a supermarket and strip mall. So he began contacting banks about loans. All of them had a 20 percent down policy and higher interest rates than he could afford.

Then he discovered the PMBDA program and worked with AEDC Program Manager David Dunn to apply for the loan.

“The 15-year loan at 4.5 percent is about half of what the commercial banks were telling me my rate would be, plus 20 percent down, which I didn’t have.”

“Rafael represents the entrepreneurial spirit of America,” said Dunn. “While at his early stage of business he may be outside traditional lending standards, he has the drive, determination and prospects to succeed and we are glad to be a part of his growing success.”

Administered by Allentown Economic Development Corporation on behalf of the Commonwealth, the PMBDA loan’s objective is to stimulate growth and expansion of minority-owned businesses and to create jobs in Northampton and Lehigh Counties. Loans of up to 90 percent of the eligible project cost (or $250,000, whichever is less) can be used for machinery and equipment costs, land costs to purchase, renovate, or for new construction. It can also be used for building acquisition, construction, rehabilitation, engineering, architectural, legal and other related costs.

Filling an unmet need in the community

De La Hoz opened his agency in August 2016 to fill a need for the Hispanic community in Allentown, and just over a year and a half later, he has over 1,000 customers. “There were State Farm agents with Spanish-speaking staff members, but none of the agents where Spanish-speaking, and there were no Latino agents in a city with a very large Latino population.”

The sale of the property closed on March 9, but De La Hoz won’t move into his new office until Memorial Day Weekend after the lease on his current office space ends. That will give him the time he needs to ready the space for his staff of three, which he hopes to grow to five or six in the coming years now that he has more space.

“When I followed my father here many years ago with almost no money in my pocket, I didn’t know what would become of me,” said De La Hoz. “I applied for jobs for almost a year before finally getting into banking as a teller and then as a manager. I worked in financial services for 13 years before transitioning to insurance sales with State Farm and it’s the perfect fit for me. I love what I do. I have a passion for it, and that passion transfers to my customers. I’m very happy with the PMBDA loan I received and am excited about the future of my business.”

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