Diamond Credit Union has created a new loan product called Fresh Start Loan to help members establish credit or improve poor credit ratings.
It makes available loans from $500 to $1,500 with one-year terms, said Todd Rothenberger, VP of Marketing at the $240 million asset CU.
"It's really designed to provide a fresh start to members who have experienced credit problems," Rothenberger told The Credit Union Journal. "As they pay it back, they'll improve their credit score and become eligible for more traditional loans."
Introduced just a few weeks ago, Rothenberger said several members have already responded to its prominent website advertising and word of mouth discussions. The in-house campaign will also be featured in the CU's magazine, direct mail and through TV/branch merchandising, he said.
The product complements DCU's free CreditCare Service, a program through which members get one-on-one reviews on their credit scores. Rothenberger said DCU's loan experts also assist members with confirming that public records are correct, provide a review of payment history, confirm outstanding debt and inform them of credit inquiries made. Once the information is obtained, these expert offer suggestions on how members can improve and maintain good credit scores.
"So many times, consumers go online in search for help with their credit history," Rothenberger said. "We wanted to create a package so they could come to us."
He said it was because of information received during CreditCare Service inquiries that CU officials decided to offer the Fresh Start Loan.
"As we've been hearing different things in the market, we realized there was somewhat of a gap in our product offerings," he said. "We needed to provide the tools to help get them back on track."
"Maintaining a solid credit history is an asset that can assist a person's financial position throughout [his or her] life," said John Faust, CEO of DCU. "In establishing Diamond's credit-builder programs, the consumers achieve financial security on their own."
