BECU Activates Income Interruption Program
The combination of a deadly hurricane and a work stoppage triggered a rare double activation of BECU's Income Interruption Program.
The program is designed to provide temporary assistance to members who need money for basics such as food, housing and medical care. In addition to these "basic need" loans, members can apply for payment deferrals on existing auto, boat, personal and home equity loans.
The $5.4-billion CU has 1,300 of its more than 400,000 members in the Gulf Coast states that suffered severe damage when Hurricane Katrina blew through in late August. Many of those members are employed at Boeing's Huntsville, Ala., facility.
At nearly the same time Katrina was doing its damage, Boeing machinists went on strike. Of the 18,400 workers in the stoppage, more than 16,000 live near BECU's headquarters in the Puget Sound area of Washington.
BECU spokesman Todd Pietzsch said he was not "aware of a situation where we had two economic events declared at the same time. We have not had too many natural disasters here."
31 Loan Deferrals
The credit union identified approximately 315 members in Hurricane Katrina's impact zone. Of those members, Pietzsch said 160 had loans with BECU. "To date (Oct. 6), we have made 31 loan deferrals and we are in the process of attempting to contact another 15 members to see if we can do anything for them," he said.
Although the four-week machinists strike was settled Sept. 29, Pietzsch said members still need assistance. The workers received a regular payroll check on Sept. 15, but will not be paid again until the end of October, he explained. "Just because they went back to work, doesn't mean they have a paycheck."
Under the Income Interruption Program, 4,344 loans-including auto, personal, home equity and Visa-were deferred for striking workers. Pietzsch said 93% of deferral applications were approved. Members took out 464 "basic needs" loans during the strike.
Loan deferrals are good for 45-60 days, or until regular checks resume, he continued. The exact date depends on the next payment date of the loan.
One BECU member who felt the sting of the recent hurricane was Daniel Smith. The paramedic student lived with his mother near New Orleans. Pietzsch said Smith's mother's house was destroyed, along with his car. BECU helped Smith by deferring payments on his former car loan until insurance can pay for it, and it arranged for a new auto loan.