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Credit Tier Stratification

  • 1.  Credit Tier Stratification

    Posted 05-20-2019 15:22

    Hello,

     

    We are considering increasing the amount of C & D paper loans we put on the books (with consideration to the likely recession happening in the near future). Knowing all CUs are different and some have different tier ranges, I was wondering if you'd provide information that demonstrates the credit tier breakout of the loans you put on the books. We are trying to gauge how conservative we are compared to others. Right now, about 85% of approved loans are in the A and B tiers, and our loan yield reflects that. There are a lot of variables involved, however if you'd be able to share information on this topic, it would be appreciated. Thank you for your consideration.

     

    Respectfully,

     

    Brett Noll
    Chief Executive Officer
    O: 410.281.6232 | F: 410.281.6207
    www.securityplusfcu.org

    Securityplus
    FEDERAL CREDIT UNION

     


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  • 2.  RE: Credit Tier Stratification

    Posted 05-21-2019 04:54

    Hi Brett,

    I hope other CUES members will chime in with the data you're after. A couple of CUES resources came to mind when I read your question:

     

    We just published this podcast with Jamie Strayer about how a CDFI designation and the funding that can go with it can be helpful to CUs that want to make loans to members with lesser credit.

    CDFI Status Is a 'Carrot' for Innovation-and a Possibility for More CUs Than You Might Think

     

    Some of the articles Bill Vogeney of Ent CU in Colorado has been writing for me lately might also be of interest.

     

    Lending Perspectives: How Will You Fund Future Loans?

    Lending Perspectives: Why Risk-Based Decisions Are Hard

    Lending Perspectives: The 5 Cs of Small-Dollar Lending

     

    Hope something in this is useful.

     

    Thanks!

     

    Warm regards,

    Lisa

    id:image001.png@01D2F3D9.3FEDAF40

    Lisa Hochgraf

    Senior Editor

    lisa@cues.org

    608.288.5317