tag:blogger.com,1999:blog-6142586076564907145.post4882176230791592033..comments2014-02-08T13:57:59.470-08:00Comments on The Credit Union Warrior: The Keith Leggett WatchMatt, the Credit Union Warriorhttp://www.blogger.com/profile/09889457998860910770noreply@blogger.comBlogger9125tag:blogger.com,1999:blog-6142586076564907145.post-66204154513990878902009-08-20T19:30:03.176-07:002009-08-20T19:30:03.176-07:00Matt,
Thank you for responding to that post from L...Matt,<br />Thank you for responding to that post from Leggett. It was right on. I really appreciate you as part of the credit union world.Dan Veaseyhttp://www.piedmontcu.org/savingsstorynoreply@blogger.comtag:blogger.com,1999:blog-6142586076564907145.post-29694654264410811472009-08-13T11:09:13.618-07:002009-08-13T11:09:13.618-07:00I have read each of your comments with great inter...I have read each of your comments with great interest and agree with most that has been said thus far. Most credit unions offering payday loan products are doing so because they know thier members are using the product at alternative services providers. Our research has shown that anywhere from 7% to 20% (or more) of credit union members are currently using (or have within the past five years) a payday loan product. This includes some cu employees. That seems to indicate they need access to short term loans. <br /><br />More problematic with these loans than the interest rate (bad enough) is the fact that they must be paid in their entirety or rolled over with new fees attached. Many payday lenders do no allow any partial payments. This is where credit unions really make the difference. We do NOT encourage a cyle of debt often seen with these loans. Credit Unions (most often):<br /><br />1. Expand terms beyond the normal 14 days often as long as 90 days thus making repayment easier,<br />2. Limiting access to one loan that must be paid in full before another is advanced,<br />3. Monitor the size of the loan to a percentage of take home pay or small amounts,<br />4. Offering or requiring savings components (like SECU) that builds wealth, <br />5. Providing some onsite financial counseling to help the member choose the right prodcut for them<br />6. (Most) provide the loans at far lesser costs than traditional sources. <br /><br />Some good examples of great programs are the Stretch Pay program and the Better Choice from Pennsylvania. <br /><br />To learn more come and visit our Impact Center and http://realsolutions.coopLois Kitschnoreply@blogger.comtag:blogger.com,1999:blog-6142586076564907145.post-19512688346534287562009-08-05T06:20:57.471-07:002009-08-05T06:20:57.471-07:00I think we all agree that we always must determine...I think we all agree that we always must determine what is in the best interest of the member. As long as our motives remain clear and transparent, the CU industry can thrive. If our industry simply plays into the commodity trap of offering the seemingly same products as banks or non-FIs, our value proposition will get clouded. <br /><br />We must better communicate our differences in a manner relevant to the consumer. Then the Leggetts of the world will have less to talk about.Bryan Clagetthttps://www.blogger.com/profile/14602315949031181952noreply@blogger.comtag:blogger.com,1999:blog-6142586076564907145.post-10495908885141092452009-08-04T20:20:37.630-07:002009-08-04T20:20:37.630-07:00Great post! Seems that bankers have forgotten that...Great post! Seems that bankers have forgotten that one part of an equation in lending is character and trust. There is always a portion of your CU earnings that you can afford to loose. Sometimes that loss happens (if you never lend you never loose) but more often than not people are appreciative of the chance they received and do pay. People never forget what the CU did for them.Gene Blishenhttp://www.tinfoiling.comnoreply@blogger.comtag:blogger.com,1999:blog-6142586076564907145.post-47867902413571039322009-08-04T17:32:28.392-07:002009-08-04T17:32:28.392-07:00@Denise True credit committees made up of member p...@Denise True credit committees made up of member peers is another old fashioned way of doing business that I'd like to see return...but that's another topic for another day. I'm with you on the definitions, though. My credit union offers many small loans at or around the $500 mark. Our rate? The same rate as if you borrowed $15,000 from us. Application fee? $0. Think a bank would waste its time with a loan this small? Not a chance.<br /><br />@Jeff The thing that bugs me the most about Leggett's posts is the hypocrisy. He's clearly a good writer and an intelligent man. He's even 100% correct in SOME of his critiques about credit unions. The problem is simply that he represents a group of for-profit banks that could make a bull in a china shop look responsible. A wise person once told me that if you point a finger at someone, there are three more pointing right back at you. How applicable is that to the ABA?<br /><br />@Michael That's a true struggle right now. The vast majority of credit unions are still doing the right things the right way. The bad apples get all the attention. We need to do a better job at calling them out for it.<br /><br />@Ginny Boards have a responsibility to make sure that the credit union members they represent are provided with a full portfolio of financial services to affordably meet their unique needs. Credit union staff have a responsibility to make sure that they council members into selecting the proper services for their specific needs. In some cases either or both have fallen short. For the most part, however, terrific volunteers like yourself populate our Boards. With folks like that leading the way, such failures should continue to be rare.Matt, the Credit Union Warriorhttps://www.blogger.com/profile/09889457998860910770noreply@blogger.comtag:blogger.com,1999:blog-6142586076564907145.post-6889304008105276112009-08-04T15:38:26.781-07:002009-08-04T15:38:26.781-07:00I don't think there is a credit union out ther...I don't think there is a credit union out there who doesn't have members who live on the edge of financial disaster. Matt, you clearly point out that it is ultimately the responsibility of credit union boards to oversee products and services so we don't make this struggle more difficult. As you say, boards also have a fiduciary responsibility to safeguard member shares. An effective board recognizes the need to weigh each of these tasks so that they are always kept in sight.Ginny Bradyhttp://www.theboardcast.netnoreply@blogger.comtag:blogger.com,1999:blog-6142586076564907145.post-8414002485561818882009-08-04T14:06:43.855-07:002009-08-04T14:06:43.855-07:00The line I enjoyed most from the USA Today article...The line I enjoyed most from the USA Today article was "It's a practice that raises questions about whether credit unions - which often bill themselves as the fee-friendly alternative to banks - have become too aggressively banklike in their quest for revenue." Have CUs lost their way? Not all, certainly - but I'd argue that some have. That's why the average consumer cannot tell the difference. The difference (or at least the perception of difference) is diminishing.Michaelhttps://www.blogger.com/profile/01264873913077644390noreply@blogger.comtag:blogger.com,1999:blog-6142586076564907145.post-58789459190576767982009-08-04T08:05:05.065-07:002009-08-04T08:05:05.065-07:00Matt: terrific post! If you take any information i...Matt: terrific post! If you take any information in a certain context, you can spin it any way you like. And that's the problem with the article that produced the rather humorous "blog" musings by Mr. Leggett. <br /><br />In any payday loan program, real APRs can be inflated by tack-on-fees, that much is true. And that's for each institution to wrestle with, as you eloquently pointed out. <br /><br />But the big picture question in any payday loan program (CU or otherwise) is this: does it help people dig a hole or build a foundation?<br /><br />I'm pretty confident that in general, that's where the clear distinction lies between credit unions and other payday loan programs. <br /><br />Mr Leggett might want to look into that distinction, as well as the distinction between a blog and - well, whatever it is he's got going.Jeff Hardinhttps://www.blogger.com/profile/10435944065441113808noreply@blogger.comtag:blogger.com,1999:blog-6142586076564907145.post-61079497157809584082009-08-04T03:54:28.161-07:002009-08-04T03:54:28.161-07:00Nicely done and that had to feel good.
I applaud ...Nicely done and that had to feel good.<br /><br />I applaud any credit union that does a "pay day" loan the old fashioned way. As a signature loan. What happened to these? One of the excuses I get - and it's outlined in the USA Today story - is that payday loans are somehow advantageous to the credit union because they are easier to disburse.<br /><br />What? <br /><br />Ok - now I'm going to sound really old. But back in the day (which was a Wednesday according to Dane Cook) I had to type loan documents on an IBM Selectric. They were printed in triplicate with carbon paper. If you made a big enough mistake, you had to start all over again. Liquid paper was your best friend. My point being, we made these so called "pay day" loans all the time. They were our bread and butter. They were the type of loans that built fierce loyalty.<br /><br />Today a chimpanzee could do a loan advance. Technology has made it so simple that I don't buy the argument of speed and convenience overriding what's best for the member. <br /><br />But to your point about Mr Leggett. Glass houses dude.....Anonymousnoreply@blogger.com