PEWAUKEE, Wis. (1/24/12)--Wisconsin credit unions saved 2.2 million state consumers $201 million through competitive rates on savings and loans and lower and fewer fees for financial services, according to the REAL Solutions Scorecard for Wisconsin Credit Unions, a report by the Wisconsin Credit Union League, released Monday.
Credit union members saved more than $128 million on loans, earned in excess of $36.6 million on savings products and paid $36.5 million fewer fees than if they had used a for-profit bank, the league report said. Most credit unions still offer free checking, a member of any credit union can save nearly $1,000 on a five-year new-car loan, and the average household saves $164 annually by using their credit union's services, the report added.
The report also cited additional value from credit unions that provide services such as nearly 30,000 hours of free financial counseling that have prevented home foreclosures and improved borrowers' creditworthiness, free tax preparation for low-income filers, outreach to new Americans, and financial education within schools. Those services are part of a voluntary effort by credit unions called REAL Solutions to help families and small businesses in ways that for-profit financial institutions typically won't offer, said the league.
Since the start of the recession in 2007, Wisconsin credit unions increased their lending to small businesses 51.8% to compensate for a lack of available business credit from banks. About $44 million of the savings on financial product use accrued to lower-income consumers. Credit unions operated 40% of all the financial institution branches in low-income areas.
Most credit unions in the state offered loans of $500 or less at modest interest rates--an alternative to costly payday loans, the league said. Credit unions also outperformed non-credit union lenders by approving 65.2% of home loans for low-income borrowers and 71.1% of home loans for minority borrowers, compared to a 56.6% and 57.2% approval rate by other lenders, respectively.
The state's credit unions also run 97 branches inside schools to teach young people to save, and students statewide stashed $3 million in their in-school accounts. Credit unions delivered 5,460 presentations to 34,104 consumers to improve their financial savvy, sponsored Wisconsin teachers to attend summer workshops that help them improve financial lessons offered in classrooms, and purchased 49,700 copies of a personal finance magazine to help 405 teachers at 350 high schools teach money management in line with state teaching standards, said the report.
Also, Wisconsin credit unions engaged nearly 15,000 students in financial decision-making through reality fairs and the online game Money Mission, supported close to 3,000 charities, granted $114,150 in scholarships and delivered 60,000 hours of online training to 5,476 employees from credit unions and Wisconsin firms to encourage investing, the league said.