OAK RIDGE, Tenn. — As layoffs and other symptoms of the financial crisis bleed from the "sand states" into other parts of the country, credit unions in previously "untouched" regions are having to develop special assistance programs for their members.
Case in point: ORNL FCU has helped more than 50 members with its Laid Off Member Assistance program in the first month after its inception.
"We're fairly well insulated but I would say based on my experience here but we're still seeing more and more impacted members as time goes on. I hope that trend starts to turn sometime soon," said special loan programs manager John Burke. "We strive to help everybody that we can, though you can't help them all. My expectation is that members are going to help us help them. If they make that commitment then we as an organization are going to everything that we can for them."
To stay proactive in fighting delinquency, front-line staff are charged with the task of looking for behavioral changes while the back office monitors delinquencies and credit scores.
"If somebody is coming in and they're depositing an unemployment check that should be a trigger and elicit some conversation. We try and connect with the member with someone right then and there. That is always the optimum," Burke said, explaining that while some members are eager to get their problems addressed with the credit union, others shy away. "The embarrassment is the biggest hurdle to clear because folks figure that they've got a problem and they'll fix it. It will go away. "
Once a member has been contacted either directly or indirectly, the credit union evaluates his or her particular financial situation and, if appropriate, offers a bevy of solutions including extensions, modifications, workouts and a free financial education program called BALANCE.
"It may be just a short-term modification of their loan payments to meet what household income they have. If we can see the light at the end of the tunnel we'll give them 90 days, 120 days at a lower payment that meets their reduced budget so they can manage their debt with the credit union," Burke explained. "Taking care of what they have here is one piece of the puzzle but they need to see what changes they need to make in their overall budget and BALANCE helps with that."
ORNL FCU's loyalty to its members in the past appears to be driving some members to taking the help instead of just defaulting, and the $1.2-billion ORNL FCU hopes the program will foster loyalty to members who may be less attached to CU. Branch manager Ryan Bennett relayed the story of one member who was laid off but determined to keep both his car and his relationship with the credit union.
"When I spoke with him initially, he was frustrated, scared, and a little bit discouraged. He did say that he would 'pay ORNL before he would eat, because the credit union has always been there for him and his family,' " Bennett shared. "Over the next several weeks 'D' would call and keep me updated on his job search...I ended up doing one extension on his loans and then when he finally found a job in South Carolina I adjusted his due dates to coincide with his new payroll frequency. He called me [and] he is back on track and his loans have been returned to auto transfer."
Burke is confident that the program will continue to move both members and the institution in the right direction while the economy sorts itself out. He sees the Laid Off Member Assistance program coupled with BALANCE as a way to keep members in good stead and financially literate.
"We want to be there when, where and when our members need us," he said.
