SOMERVILLE, Mass.-CPCU Credit Union is starting the new academic year with a "Back to School Loan" it describes as designed to assist parents, young adults and educators with the growing number of costs associated with starting a new academic year.
CPCU says that it is the only lender in its market offering such a product.
The $107 million CU noted the start of an academic year means students are paying for textbooks, computers, school supplies, dorm room necessities and, in some cases, school-required uniforms. Also, with many district budgets tight, teachers are spending their own money to buy classroom items.
The loan is available in amounts ranging from a floor of $500 up to $2,000 and in terms of three to 12 months, which CPCU said will allow the loan to be paid off by the start of the following school year, should another loan be needed.
Raquel Sa, marketing manager, told Credit Union Journal CPCU began offering the new product Aug. 6, making it too early to determine the level of consumer demand.
"The first week was just a soft launch, followed by an e-mail blast and Facebook posts," she said. "It has generated some interest, but we do not know exactly how much yet."
According to Sa, the loan features a lower-than-usual rate for an unsecured loan. Traditional unsecured loans from CPCU are as low as 10.99% APR, but the Back to School Loan will be as low as 7.99% APR.
"This makes the loan more affordable for young people or teachers," she said. "We thought we would give people the opportunity to have different terms since the loan has to be between $500 and $2,000. People have the opportunity to take out this loan and then take out another one next year."
CPCU is formally known as Cambridge Portuguese Credit Union.
