MADISON, Wis. (10/2/13)--Once the federal government announced its partial shutdown Tuesday, credit unions lost no time in letting impacted members know their credit unions will provide special rates, skip-a-payments, financial counseling and more to ensure members survive any furloughs with their finances intact.
Many credit unions with federal employees already had in place special programs from past shutdown threats and were ready from Day One of the shutdown.
"Andrews Federal stands ready to provide our members with financial assistance and options to help curb the adverse effects that the government shutdown may cause," said Jim Hayes, president/CEO, Andrews FCU, Suitland, Md.
It will offer a Bridge Loan up to $5,000 at a 0% annual percentage rate (APR) for 90 days. After 90 days, the standard APR will apply. It also will have flexible terms up to a year and offer payment options to manage the loss of income.
The $900 million asset credit union serves more than 100,000 members in the District of Columbia, on bases in Maryland and New Jersey, and military installations in central Germany, Belgium, and the Netherlands. It also serves select employee groups in D.C., Maryland, and New Jersey.
Redwood CU, Santa Rosa, Calif., sent an e-mail to members Tuesday letting them know the $2.2 billion asset credit union is there to support them. It is placing information on its website.
"RCU's No. 1 priority is assisting our members, especially during times of uncertainty like the current government shutdown," said Robin McKenzie, senior vice president at RCU. "We encourage members employed by the federal government or agencies impacted by the shutdown to contact us for assistance." McKenzie noted some of its services include:
- Payroll replacement/advance assistance;
- Deferred payments on RCU loans and lines of credit;
- Early withdrawal of funds from RCU share certificates without penalties; and
- Money management and budgeting information and tools.
Hanscom FCU at Hanscomb AFB, Mass., which serves federal employees in Massachusetts, said its members will have access to a 0% APR interest line of credit--called a Life Line Loan--for 60 days, equal to one month's net payroll up to $5,000. The interest-free loan is attached to the member's checking account to provide additional funds to cover checks, ATM withdrawals and debit card purchases.
The $1 billion asset credit union also will waive penalties for premature withdrawals on term share certificates and provide free, confidential financial counseling and education through its BALANCE Financial Fitness. Members can schedule a one-on-one phone session with a certified financial counselor for help with budgeting, managing credit and assessing their finances.
"We have supported our members affected by furloughs over the summer, and we continue to be here for members," said Paul Marotta, Hanscom FCU's board chairman. "We are true to our roots and the credit union motto, 'People Helping People.'"
At Jacksonville, Ark.-based Arkansas FCU, "we've been through this before, so we're prepared to do anything and everything we can to make sure the men and women who serve our country will be well taken care of" in a shutdown, said Larry Biernacki, president/CEO. He urged members to call the credit union if the shutdown threatens their well-being.
"Thousands of our members rely on a government paycheck to make their automatic loan payments, credit card payments and more each month," Biernacki said. "We want those members to know we are willing to work out an arrangement on an individual basis if a government shutdown interrupts their normal financial well-being."
Other credit unions offering assistance include:
- Wright-Patt CU Inc., a $2.7 billion asset credit union in Fairborn, Ohio, which is offering a special "Shut Down" loan that is an unsecured loan equal to the member's normal federal net bi-weekly pay at 6.25% APR up to 12 months for qualified borrowers. If the loan is paid back within a month, Wright-Patt will waive the interest. Its skip-a-payment program charges no fee or late fee, the loan won't show up as delinquent and it will not generate a derogatory report to the credit bureau.
- Members 1st CU, Redding, Calif., which is offering financial assistance to all federal government employees who live, work or worship in Shasta and Tehama Counties--regardless of whether they are members of the credit union or not. It will provide 0%-interest payroll assistance loans up to $3,000 for 12 months, fee free, and personal loan options with different rate options for terms 24-36 months. Members with existing loans will have additional flexibility with modified payments or skip payments. And federal employees will receive expedited review and approval for line increases or new credit lines on their Members 1st credit card.
- NASA FCU, Upper Marlboro, Md., with assets of more than $1.2 billion, which is offering 3% APR on a line of credit to members with checking accounts and direct deposits and who are subject to the furloughs. The special rate is effective through Dec. 31.
- Chartway FCU, Virginia Beach, Va., with more than $1.9 billion assets, which told members on its website it has pledged "to do whatever it takes to help you adjust to this shutdown by extending leniency and special considerations to ensure you have the support you need and the money you require."
- Veridian CU, Des Moines, Iowa. The $2.5 billion asset credit union announced Tuesday it would provide interest-free, 30-day loans to members experiencing delays in payment as a result of the shutdown.
- Fort Knox FCU, Radcliff, Ky. The more-than-$1 billion asset credit union is offering interest-free loans for one month to cover lost pay, extended terms on existing loans to reduce monthly payments, and the opportunity for early withdrawals up to $10,000 on term share certificates without an early withdrawal penalty.
Credit unions that go above and beyond in looking out for members' interests are demonstrating one of the key tenets of the national Unite for Good campaign: fostering service excellence. The campaign, launched by the Credit Union National Association and the state leagues, is rallying credit unions to work toward the goal in which Americans choose credit unions as their best financial partner. Use the links for more information. Also, see today's related News Now
story, For CUs: Agencies' Status During Gov't Shut Down.