HERNDON, Va., and SCRANTON, Pa. (2/28/13)--Two credit unions are taking steps to help workers feeling a cash crunch because of job furloughs, in the event of federal government sequestration, taking effect Friday. The sequestration would impact nearly all government agencies through a series of across-the-board, automatic budget cuts.
The steps are yet another example of credit unions working proactively on behalf of their members, said the Credit Union National Association.
Northwest FCU, based in Herndon, Va., with $2.5 billion in assets, will provide loans up to $10,000 at 0% interest to members who may be adversely affected by the impending federal government furlough. In addition to the 0% loans, Northwest Federal also will waive the early withdrawal penalties on any certificate of deposit for members who may need immediate access to their funds.
Should the government sequestration take effect, the special interest rate will be available for members who meet minimum qualifications for a period of up to 90 days after their furlough period ends.
Many believe the sequestration could have far-reaching consequences. Should this happen, Northwest FCU will be ready, said Colleen Daly, the credit union's senior vice president of lending. "We're here to offer some peace of mind to our members who may be worried about how government furloughs might affect their personal financial situations," she said.
Also, Tobyhanna FCU, based in Scranton, Pa., has instituted a Furlough Assistance Program, according to its website.
"If you've been affected or expect to be affected by a furlough, we are offering the following: Receive up to $7,000 at 0% annual percentage rate, for up to six months with no payments," Tobyhanna said.
The $165.6 million asset credit union's program is being offered to current and new members. To be eligible, members must provide at least two pay stubs or have a direct deposit with Tobyhanna. No application is required, just a written communication that the member is on furlough. Also, there are no credit requirements.
One of CUNA's and the credit union system's key visions involves values-based decision-making rooted in credit unions' shared values, including collaboration, a focus on members, community involvement, and a dedication to financial well-being, said CUNA President/CEO Bill Cheney this week at CUNA's Governmental Affairs Conference.