We have stayed away from staff discounts to avoid appearance of favoritism
David W Proffitt
President and CEO
Alcoa Tenn Federal Credit Union
Loans to employees – Based on regular lending criteria and qualifying aspects, Credit Union West
Employees have the same borrowing privileges as any other member. Credit Union West staff, management, officers, board and committee members are in a position of trust, and are expected to adhere to high standards. Employees who are not in their 90-day probationary period after hire, or who are not on performance related probation, are eligible for a 1% rate reduction on either their existing closed end consumer and home equity loans at time of hire with CU West or new loans obtained while actively employed. For home equity and HELOCs, the processing and AVM fee will be waived. For mortgage loans, employees will receive $1,000 off the origination fee in addition to the rate being set at a percentage that would earn the credit union no more than 1% if sold on the secondary market. The mortgage discount only applies to new mortgages obtained with the credit union while actively employed. For home equity loans, the processing fee will be waived. The employee is responsible for paying any actual expenses incurred by the credit union for items such as valuation and title. The rate reduction on closed end consumer and home equity loans is in effect only during their employment tenure and is subject to all criteria outlined by management. Loans to employees will be processed at the prevailing consumer rates and a modification agreement and addendum will be used to make the proper adjustments to the loan rate. 1) The Lending Managers shall approve all employee loans of equal or less employment grade levels, with processing to be completed by the designated employee.
2) Loan requests from the President/CEO will be approved by the Board of Directors.
3) Employees, who go through the Indirect Lending program where a participation fee is paid to the dealership, will not be eligible for the employee discount on that particular loan.
4) Members of the Official Family (Board of Directors and Supervisory Committee), Executive Management Team (EMT), Risk Management Team and immediate family members of both of these groups are not eligible to purchase Credit Union West repossessed vehicles. All other employees may purchase Credit Union West repossessed vehicles. Approval of the sale and subsequent Credit Union West financing must be granted by two members of the EMT.
5) The rate on loans granted to employees for vehicles and recreational vehicles will be at the higher of the floor rate or the rate after the 1% discount is applied.
6) Skip-A-Pay Program: All employees are eligible for the Skip-A-Pay program based on the regular member criteria and qualifying aspects.
7) Loans that are business type or a consumer line of credit, including Credit Cards and HELOCs after October 1, 2011, or any special promotional rates will not be eligible for the 1% discount. Employees that had an existing HELOC, Credit Card or other line of credit prior to October 1st, 2011 will maintain their discount until termination of employment from the credit union. The employee will be given 45 calendar days' notice after separation from the credit union prior to increasing the rate.
8) All extensions or modifications, excluding Skip-A-Payments, to employee loans must be approved by Loan Manager, as defined in 1. Z.
Below is the section of our employee handbook that addresses our loan rate discount for employees.
Employee Loan Rate Discount
Credit Union employees will receive an annual percentage rate discount of 2% on loans they have through the Credit Union while employed. The rate discount does not apply to First Mortgage loans or the Credit Union's VISA program. The rate discount applies to all other loans that an eligible employee is a borrower on at the Credit Union. Management reserves the right to review the purpose and beneficiaries of the proceeds of the loan and can refuse to extend the discount if the employee is not a direct beneficiary.
All employees who have completed six (6) months of employment with the Credit Union are eligible for the rate discount. Employee loans must all be current and satisfy the Credit Union lending policy. When an employee becomes eligible for the rate discount, any qualifying outstanding loans of the employee will be given a 2% rate discount. The rate discount also applies to any new qualifying loans financed through the Credit Union.
All qualifying loans will be written, disclosed and signed at the standard Credit Union rate in effect on the date the loan is taken out. The standard rate is the base rate, less any other discounts the employee qualifies for. The 2% rate discount will be reflected in the data processing system and will apply to loan balances outstanding while the employee is eligible for the discount. The loan rate applied after the 2% discount cannot be lower than 2%. The payment amount will not be adjusted to reflect the rate discount unless requested by the employee.
An employee is no longer eligible for the rate discount if employment is terminated, either by the employee or the Credit Union; the employee is in a probationary period; or, if any of the employee's loans are over 15 days in arrears. In the case where an employee's loan is over 15 days in arrears, the employee must keep all Credit Union loans current for three (3) months before the rate discount will be reinstated. When an employee is no longer eligible for the rate discount, any outstanding loans with the 2% discount applied will be adjusted to the standard rate. This increase will be reflected in the data processing system. If the loan payment was decreased, it will be increased back to the disclosed payment on the loan note.
HomeTown Credit Union
2400 W Bridge St, Owatonna, MN 55060 (507)455-6728
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