In 2019, Tim Timmer spearheaded the creation of a commercial lending division at O Bee Credit Union. Later that year, the burgeoning department’s outstanding service was recognized by Evergreen Business Capital, which awarded the team a Top Partner Award for its work in the Small Business Administration (SBA) 504 program. In life, Timmer dons two hats: that of vice president of business lending at O Bee, and also as the co-owner and CFO of Fresh Start Housing, a program that provides clean and sober living to unhoused people throughout Washington state. This organization is close to Timmer’s heart, since matters of homelessness and small business are closely intertwined with his personal narrative.
Timmer is no stranger to adversity — childhood hardships sent him down a challenging path. When he was 6 years old, his family relocated from Washington to Glenwood, Minnesota, where Timmer’s father owned and managed a pizzeria and a small cafe. But the farming crisis of the early ’80s soon put everything at risk.
“He lost his businesses. It really stuck with me — even as a child — A) how hard that was, and B) how so many factors were out of his control at the time,” Timmer said.
Timmer returned to Washington with his father, who struggled with complications from a chronic illness. When Timmer was in high school, his father died, and Timmer was left with few places to go. Still a teenager, he became homeless, and said he was lucky to be able to rely on the generosity of friends who provided him places to stay.
Timmer went on to attend South Puget Sound Community College, where he met his wife, Rebecca. Post-college, Timmer took a job at a retail furniture store. It was during a furniture delivery to a branch of US Bank that he launched himself into the world of personal banking at the recommendation of a banker there.
After stints at US Bank and South Sound Bank, Timmer became interested in applying his commercial lending know-how to the credit union sphere. He reached out to O Bee about the possibility of developing a commercial lending program and was hired shortly thereafter.
Rather than operating within a traditional corporate structure that emphasizes generating value for shareholders, Timmer wanted to work for a credit union, where the value of what he was creating would go back to members. “That’s just always resonated with me,” Timmer said.
Since the pandemic hit, Timmer’s department has worked tirelessly to bring relief to the credit union’s small-business members. O Bee was recently approved for SBA 7(a) processing, amplifying its ability to provide financial assistance to small businesses that have been impacted by the pandemic.
We recently talked to Timmer about his role in building O Bee’s commercial lending program, his drive to give back, and what he sees in store for 2021.
O Bee Credit Union’s current commercial banking program wasn’t its first attempt at getting into commercial lending. What challenges did they face when they tried initially?
I think it was political. Credit unions in Washington state were just dipping their toes in commercial banking, and there was a pretty strong rebuke from the local banking lobbyists at the time. I think at that point, O Bee just wasn’t in the position to take on that big of an ordeal, so they backed out. Since that time, there’s been a lot of credit unions that have gotten into commercial banking, and it just seemed like the timing was right (to try again).
Tell me about some of the challenges your team faced in building O Bee’s commercial lending division.
Certainly, there’s a lot of challenges when you’re starting a program from the ground up, and that’s what we were doing. When you have something like that, you have to have individuals who come over with that base knowledge of credit underwriting for commercial loans and lines of credit. You can’t be somebody new or somebody who doesn’t have any experience, because the catch-up time is pretty significant, and we had to hit the ground running. So, having individuals who came in with collectively over 40 years of experience — that was really important to making sure this was successful.
Small businesses have been hit so hard by the pandemic. How has that impacted your department and your lending practices?
You really have to be good stewards of the programs that are available. For us, the Paycheck Protection Program (PPP) put on by the SBA was something we reviewed, but unfortunately, with just three of us and not having SBA abilities at the time, we were unable to jump on that like we wanted to. So, we had to find some sort of solution for not only our members, but also individuals who were calling and not getting any other solutions anywhere else. We knew we had to come up with something, so we reached out to a group called Lendio, and Lendio was able to put a link on our website and do SBA PPP submittals through that website.
It was a solution. It wasn’t our favorite — we certainly like to have those tangibly — but it did teach us something. We want to be prepared going forward. So we have applied and have been approved for our SBA ability to do 7(a) processing. If these types of programs come up in the future, we’ll be better prepared for it.
That’s one, and two: We have to take a look at each business application. Not just with the way things are right now, but we also have to look back at that business’ history, and we have to be somewhat optimistic about what’s going to happen in the future. We can’t simply make that decision based solely off (2020). That’s unfair. And we don’t believe it’s going to last. Things have to get better at some point.
In addition to your role at O Bee Credit Union, you’re the co-owner of Fresh Start Housing, which provides clean and sober housing for homeless community members throughout the area. What motivated you to pursue that?
I know what homelessness feels like. It was brief in my life, and it was when I was a young man. I had friends and individuals who allowed me to couchsurf or gave me temporary shelter, and that was far better than others I’ve met and talked to. So, I had a leg up, but I was homeless. What people need to understand is, it is very hard to pull up your bootstraps when you don’t have boots, and you’re barefoot. It’s very hard to go for a job interview when you don’t have hot running water and some place to shower, and now you’re expected to go put your best foot forward when you don’t have a place to put your clothes.
Fresh Start isn’t just about providing homes for the unhoused, there’s a drug and alcohol component, too. Can you speak about that?
My family definitely had issues with that, and I know how difficult that is, as well. It’s a battle that’s not a clear and definitive win. You don’t just have one day sober and (say), “Great, you’re done; you’re on with the rest of your life.” It’s a consistent, constant battle, and I wanted to find solutions for both. At the same time, I wanted to combine it with my know-how of the commercial world. I needed to make sure that I could do this in a fashion that I understood. And what I understand is, it was doing this as a for-profit type business.
What’s in store for your department in 2021?
We can go forward with some of the unsecured lines of credit with SBA support. We can help individuals who are looking to purchase a business that they’ve been working at for years and just don’t have the capital to come in and put the down payment that most banks would require. Now we can offer that. We can offer it to some folks who maybe COVID-19 has thrown for a loop, but they still see some opportunities to grow their business. Unfortunately, 2020 (was) unkind because of COVID. We can put that under the SBA 7(a) microscope and still get some sort of solution and satisfaction.
The terms are all very favorable — the first three months of payments are provided by SBA; SBA-guaranteed fees are waived for the client; and the SBA loan guarantee has been raised from 75 to 90 percent until Sept. 30, which allows financial institutions to offer higher-risk lending than they usually would. So, I’m bullish; I’m very excited about what’s to come. And I think everyone is so hungry to go out and start going to restaurants again … I think people are going to just go bonkers, and I think you’re going to see the economy, at least the local economy, is going to reflect that. And we want to be prepared. So, I can’t wait for that.