As state employees across the country are being hammered by layoffs, pay cuts and forced unpaid days off, some state employees’ credit unions are stepping in to help workers get through these tough times. Services include a variety of loan programs and even one Web site for recession and job-related tips.
The Virginia State Employee Loan Program allows state workers, regardless of their credit history, to borrow up to $500 twice a year. Since Gov. Tim Kaine (D) announced the pilot’s launch July 13, more than 1,620 employees have received loans.
“The good news is that we have a loan for this. The bad news is that they need it,” said Sara Wilson, the chairwoman of the Commonwealth of Virginia Campaign (CVC), a group that coordinates charitable giving by state workers. The CVC operates the program jointly with the Virginia Credit Union.
The loans have a 24.99 annual percentage rate. So for a loan of $100, the worker pays back $108; a $500 loan would cost $540. An employee must have an account with the credit union to receive a loan, and a portion of the money is deducted from a worker's account until the loan is paid back in six months.
Read the full report Credit Unions Help Strapped State Employees on Stateline.org.