Client Beat: Chetarah’s Story

Small business owner navigates financial stresses in an uncertain world

“When COVID hit it was really scary; I’ve never been told I had to close before when my hands still worked and business was good.”

Chetarah is a single mother of 3 who owns a couple of salons and a restaurant in California. Since the start of the pandemic, Chetarah’s businesses have been impacted by constantly changing policies and safety measures; the only constant has been uncertainty. “When COVID hit it was really scary; I’ve never been told I had to close before when my hands still worked and business was good.” Chetarah heard about TrustPlus through the small business lender Opportunity Fund, and right away signed up for a session with a financial coach, Elise, to help her brace for the unknown.

Facing rent arrears and reduced restaurant capacity

As of September, both her salons were back open after having to close twice, but she owed $7,500 in rent arrears to the salons’ landlords. At the time, her restaurant was allowed to be open for dining-in at 25% capacity, but with customers’ inconsistent adherence to mask-wearing rules, she decided to prioritize her employees’ safety above all else — Chetarah made the difficult decision of forgoing more income and just offered takeout. She is also struggling with being understaffed because, when her restaurant closed during the peak of the shutdown, her employees qualified for Pandemic Unemployment Assistance (PUA) and now remain at home even though the restaurant is open again. To show her gratitude to those employees who came back to work despite being eligible for PUA, and those she’s hired in recent months, she gave everyone a small bonus on the anniversary of the restaurant’s opening. She wants them to know she’s doing the best she can to protect their health and livelihoods, but remains in a difficult position as she is unable to use her catering truck, her second location opening has been postponed and there is no relief in sight from her commercial rent obligation.

Facilitating remote learning reducing expenses

Having all 3 children at home and facilitating their remote learning has been an additional source of stress. Her oldest daughter really misses being at college and her two younger children are navigating elementary and middle school remotely. She has looked to reduce her expenses in every possible way, even negotiating with her phone company and internet provider with limited success. When the company that financed Chetarah’s car asked her to come in to talk about refinancing options, she arrived at the dealership only to be subjected to an upsell pitch on a new car! She walked away after the company told her that it was too early for her to be able to refinance.

The unexpected impact of mortgage forbearance

Chetarah is also a homeowner. She typically relies on the rental income from her tenant to help pay her mortgage so when her tenant lost their job at the start of the pandemic, she got scared knowing she would need to cover the loss in rental income for an unknown length of time. Driven by that fear, she requested a forbearance on her mortgage because, at the time, it sounded like the safest option. After she met with Elise, she learned that her mortgage lender had not explained her options clearly and that her best bet would’ve been refinancing her mortgage (her current interest rate is 5.2%, while the average APR is 3.25%). Her lender also failed to tell her that her hardship forbearance would limit her refinance options down the road. In November, Chetarah’s mortgage company was telling her that she would owe all of her suspended mortgage payments ($19,000 worth) at once. Much to her relief, Chetarah’s mortgage company approved her for a loan deferment, which will move her missed payments to the end of her mortgage. Her credit has taken a hit as a result of this increase to her mortgage balance, but she much prefers that than to have her lender begin to foreclose. Chetarah has been in touch with HUD and keeps trying to get in touch with her elected officials at their offices, but reports that even when someone answers the phone they have been of limited help.

Getting support and remaining hopeful

“…getting financial coaching helped me slow down, take a step back, and gain an outside perspective.”

Despite mounting obstacles, she remains grateful and hopeful for the future. “I appreciate what I have — I can still turn a key to my home and to my business. I see a light at the end of the tunnel — even if it’s tiny.”

“Elise has been great to have at this time because she helped remind me that we’ve all been affected and I’m not in this by myself. Life was moving fast and business was going well so getting financial coaching helped me slow down, take a step back, and gain an outside perspective.”

TrustPlus is now offering financial coaching services for free to small businesses and their workers, as well as providing critical resources to protect workers and families impacted financially by COVID-19. Learn more about our relief efforts. Text RELIEF to 646–349–5959 to sign up to speak with a coach today.