WESTconsin Credit Union has partnered with a local social services agency to help single mothers purchase reliable vehicles so they can get to and from work.
Leo Schindler, VP of Lending, said WCU provides the loan funds, the loan servicing and the lending expertise to the clients of Westcap-West Central Wisconsin Community Action Agency, Inc.-a community-based organization that serves seven counties.
"The program helps us achieve our goals which is reflected in our mission statement: WESTconsin Credit Union is committed to helping our members achieve financial success," Schindler said.
He said the program was designed to help low income/high risk borrowers on government aid to integrate into the workforce.
"Adequate transportation was identified as one of the major barriers," Schindler said.
Craig Adams, Westcap replicator (liaison with the organizations interested in replicating the program), said the success has been incredible.
Recent surveys show that 70% of those who received loans said they had a reduced dependency on public assistance, 51% moved into better housing-20% of whom purchased their own homes. In addition, Adams said, many reported having better access to childcare and educational opportunities.
Adams said his organization approached WCU at the program's inception.
"We think it's a natural alliance for one non-profit to partner with another non-profit," he said. "They've been a good partner."
To qualify for the loans up to $10,000, applicants must be designated by the federal government as 200% below poverty level. There are special considerations for those who are pregnant, have a minor children or support one. They must also receive public assistance such as medical aid, food stamps, and subsidized childcare.
WCU underwrites, funds and services the loan, he said, adding that because Westcap guarantees the total principal, the CU can offer its lowest interest rates.
Because Westcap does such a thorough job screening applicants, Schindler said the CU rarely has to turn anyone down.
Some applicants who qualify receive the first $1,500 as a non-interest loan that is forgiven after the CU loan is paid in full.
"One of the program's features is that they have an in-house vehicle expert who buys the reliable, efficient used cars," he said. "They do a good job inspecting them for soundness and get them at a good price."
Since the partnership started in March of 2001, the CU has provided more than a half million dollars in loans to more than 100 borrowers.
Adamsaid he is working to expand the program to other parts of the state and would be pursuing similar partnerships with other CUs. "We recently received substantial federal funding in three other community action agencies in Western Wisconsin," he said. "We'll be starting those programs up this spring."
