wlm4 at cornell.edu (Will
03-08-1995, 09:30 PM
CONSUMER LOANS - Alternatives Federal Credit Union Annual Report
Our 1994 consumer loan originations were fairly evenly split among male and
female. About 20% of our loans went to same sex couples. 60% of our loans
went to borrowers earning less than 80% of the County median income. 10%
went to minority borrowers. 55% went to urban borrowers, 34% to rural, 10%
to loyal members who live out of our area altogether. 5% of consumer loans
went to borrowers who were wholly self-employed. Over 10% of our loans went
to single parents.
The goals of the consumer loan department are to provide quicker loan
turnaround and to stretch the envelope of lending to include more low income
borrowers. Changes have made borrowing with the Credit Union a quicker
process for members. We streamlined income verification by accepting copies
of W-2s and most recent pay stubs as verification of employment and income
for most of our loan applicants. Now, nearly 75% of all applications receive
a decision in 2 business days or less. We also relaxed some guidelines to
unsecured lending by giving our loan officer more room to make an
independent decision. By reducing the need to have two loan officers review
certain loans, decision time was improved. For 1995 the departments' goal is
to guarantee loan decision in one day. To this end, Betty Henderson is
in-training to be a loan officer.
We also, for the first time, gave automatic credit line increases to
eligible members. Pre-approved Lines of Credit were offered to members who
obtained mortgages with the Credit Union, and 50% of our members received
$1000 increases in their Lines of Credit for having an excellent payment
history. The increases were generally very well received with only one
member out of 432 not keeping the increase. The job was accomplished with
teamwork between the Mortgage, Consumer Loan, and Data Processing Departments.
In response to a smart member suggestion, the Credit Union instituted
discounts on interest rates for New and Used Car loans based on use of other
Credit Union services, shorter term and 20% down payment. Networking with
other businesses generated a good deal for members from Stafford Chevrolet,
in Dryden. Credit Union membersbuying a car pay 2% above invoice on new cars
and at or below NADA retail for used cars by informing the Sales Manager
"Tall Paul" that they are members of the Credit Union.
We have had numerous queries about auto leasing and we are working on the
details of a plan to offer leasing to our members. We are talking about
offering both a car buying service and leasing service. We have piloted both
these programs with great results. We are expecting to offer a special loan
for low income borrowers and first-time borrowers.
We will offer two new Visa products. The first, Alternatives Visa Entry
(already being field tested, and beautifully designed by member Steve
Sierigk of Acorn Designs) will have no annual fee, no credit line and $1
fees for ATM cash withdrawals. Since Alternatives Visa Entry has no line of
credit, eligibility is easier, making this the perfect "entry" card for new
users or people not interested in a credit line. The second new card,
Alternatives Visa Grace, will be a standard credit card with grace days, no
annual fee and an excellent rate. That card will be introduced by mid-year.
We are always open to ideas from you in ways that we can serve you better.
Ronda Johnson, Alternatives Credit Union Consumer Loan Officer
This post transferred from the cdb-l mailing list
Our 1994 consumer loan originations were fairly evenly split among male and
female. About 20% of our loans went to same sex couples. 60% of our loans
went to borrowers earning less than 80% of the County median income. 10%
went to minority borrowers. 55% went to urban borrowers, 34% to rural, 10%
to loyal members who live out of our area altogether. 5% of consumer loans
went to borrowers who were wholly self-employed. Over 10% of our loans went
to single parents.
The goals of the consumer loan department are to provide quicker loan
turnaround and to stretch the envelope of lending to include more low income
borrowers. Changes have made borrowing with the Credit Union a quicker
process for members. We streamlined income verification by accepting copies
of W-2s and most recent pay stubs as verification of employment and income
for most of our loan applicants. Now, nearly 75% of all applications receive
a decision in 2 business days or less. We also relaxed some guidelines to
unsecured lending by giving our loan officer more room to make an
independent decision. By reducing the need to have two loan officers review
certain loans, decision time was improved. For 1995 the departments' goal is
to guarantee loan decision in one day. To this end, Betty Henderson is
in-training to be a loan officer.
We also, for the first time, gave automatic credit line increases to
eligible members. Pre-approved Lines of Credit were offered to members who
obtained mortgages with the Credit Union, and 50% of our members received
$1000 increases in their Lines of Credit for having an excellent payment
history. The increases were generally very well received with only one
member out of 432 not keeping the increase. The job was accomplished with
teamwork between the Mortgage, Consumer Loan, and Data Processing Departments.
In response to a smart member suggestion, the Credit Union instituted
discounts on interest rates for New and Used Car loans based on use of other
Credit Union services, shorter term and 20% down payment. Networking with
other businesses generated a good deal for members from Stafford Chevrolet,
in Dryden. Credit Union membersbuying a car pay 2% above invoice on new cars
and at or below NADA retail for used cars by informing the Sales Manager
"Tall Paul" that they are members of the Credit Union.
We have had numerous queries about auto leasing and we are working on the
details of a plan to offer leasing to our members. We are talking about
offering both a car buying service and leasing service. We have piloted both
these programs with great results. We are expecting to offer a special loan
for low income borrowers and first-time borrowers.
We will offer two new Visa products. The first, Alternatives Visa Entry
(already being field tested, and beautifully designed by member Steve
Sierigk of Acorn Designs) will have no annual fee, no credit line and $1
fees for ATM cash withdrawals. Since Alternatives Visa Entry has no line of
credit, eligibility is easier, making this the perfect "entry" card for new
users or people not interested in a credit line. The second new card,
Alternatives Visa Grace, will be a standard credit card with grace days, no
annual fee and an excellent rate. That card will be introduced by mid-year.
We are always open to ideas from you in ways that we can serve you better.
Ronda Johnson, Alternatives Credit Union Consumer Loan Officer
This post transferred from the cdb-l mailing list