Low income, no problem: How CASE CU is expanding lending

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Management at CASE Credit Union wants employees to step away from a list of checkboxes when working with members.

“All of our staff go through a series of member loyalty training,” said Brett Pacek, vice president of lending at CASE CU. “We want them to listen to each individual member’s story. Then by virtue of looking at their credit report, their story, their payment histories and asking the right questions, to qualify them for the loan product or service to suit their individual needs.”

The Lansing, Mich.-based CU was recently recognized for exemplary lending practices at the 23rd CUNA Lending Council Annual Conference with an Excellence in Lending Award for low-to-modest means lending at CUs with assets more than $250 million.

As a Community Development Financial Institution, the majority of CASE CU’s membership are low to modest means and around a quarter of the CU’s membership is low-income.

“Our goal is to serve every member that walks through the doors,” said Jeff Benson, president and CEO of CASE CU. “Regardless if they’re unbanked or if they are banked but their credit is already challenged, we can get them a good product.”

The CU was highlighted for three of its low income programs.

Its Borrow and Save Loan Launch helps borrowers develop a savings habit by providing 50 percent of the loan amount up front and setting the rest aside in a savings account that is released when the loan is paid off.

The Responsible Ride Auto Loan program removes vehicle year and mileage guidelines so members can obtain financing for lower-cost vehicles. Most guidelines won’t finance any vehicle older than 2012 or has more than 150,000 miles on it, Pacek said. So long as the vehicle is under $7,500, CASE CU will finance the car through this program.

The newest of these initiatives, the Property Tax Foreclosure Home Equity pilot program, offers financial counseling and loans for members who own homes outright but are in danger of foreclosure for failure to pay property taxes.

“We came across individuals in our community through one of our partner organizations that identified folks that had homes owned free and clear … but for whatever reason has just stopped paying their taxes,” Pacek said. CASE CU gives them a HELOC and escrows the account so the member pays their taxes on time and avoids foreclosure.

For these programs, financial performance is closely monitored, but the board and executive team have agreed to accept higher delinquency rates to serve members of low to modest means.

“We’ve been surprised because [the rate of delinquencies] has been pretty much flat,” Benson said. “We actually got board approval to receive more delinquencies, but we found out that they pay, and they pay them on time.”

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