LANSING, Mich. –The Michigan CU League has released new data compiling how the state’s credit unions have provided financial help, including with mortgage assistance, emergency loans and assisting small business owners with Paycheck Protection Program loans, during Q2 in response to the coronavirus.
According to the league, during Q2, the state’s credit unions assisted more than 10,400 small businesses in attaining nearly $600 million in PPP loans, 10% of which are for new credit union members who found the help they need when turning to their local credit union. These loans helped keep many of Michigan’s Main Street businesses operating, with a median size around $20,000 per loan, the MCUL said.
Additionally, the league reported credit unions throughout the state have done “outstanding work assisting members with mortgage relief, making every effort to keep people in their homes during this crisis.” An estimated 14,000 homeowners owing more than $1.9 billion in mortgage loans have received assistance with mortgage payment delays, the league said, adding more than 300 homeowners had their foreclosures postponed.
A Quarter-Million Skipped Payments
Moreover, according to the league data, members in need were issued more than 250,000 skipped payments, resulting in more than $1 billion payment delays due to income loss-related financial hardship. In addition, credit unions offered another $22.5 million in emergency loans and $800 million in auto and consumer loan modifications, the league said.
“These numbers are very powerful and speak to the overwhelming impact our not-for-profit movement has on the lives of millions of Michiganders,” said MCUL CEO Dave Adams. “Once again, we showed that when a crisis hits, you can always turn to your local credit union. Even outside of these product and service offerings, we have seen credit unions go to great lengths to make sure many of their members’ needs are met, financial and otherwise.”
The Data Points
The MCUL survey of credit unions from March 24 to June 30th found:
- More than 10,000 Paycheck Protection (PPP) loans for nearly $600 million have been made to very small businesses with an average of fewer than five employees. Median average loan sizes were $20,000 and one in ten businesses received financing from a credit union after being turned away by other lenders.
- The majority of Michigan credit unions have been voluntarily assisting financially impacted homeowners by delaying foreclosures and offering payment delay (forbearance) arrangements. More than 140 credit unions and support organizations signed on to the Governor’s April 23 MiMortgage Relief Partnership that sought to broaden these efforts to all mortgage loan servicers in Michigan.
- More than 14,000 families owing more than $1.9 billion in mortgage loans have received assistance with their mortgage payment delays (forbearance), and more than 300 foreclosures have been postponed due to financial hardship related to temporary income loss.
- On auto and other consumer loans, credit unions have allowed more than 250,000 skipped payments on loan amounts totaling over $1 billion in member assistance.
- Also, on auto and other consumer loans, nearly 80,000 loans, covering $800 million in outstanding loans, have had payment terms modified to provide financial relief.
- Emergency cash loans, usually carrying a zero-percent loan rate and deferred payments, were made to more than 9,500 financially impacted consumers on an estimated $22.5 million in loans, providing an average of $2,300 per borrower — essential funds for paying rent, other critical bills and just putting food on the table.
- Credit unions impacted members with more than 450,000 fee waivers for late payments, early CD withdrawals, Insufficient funds fees and ATM and overdraft fees, saving members more than $9.5 million.
- Credit unions are also stepping up their normal community service efforts, the league said, expanding support to organizations statewide with over $1.7 million in contributions, including an estimated $420,000 in support for first responders. These efforts have included the donation of gloves and masks, pizza lunches and snacks for healthcare workers, small grants for local restaurants and partnering with local radio stations to recognize and reward healthcare heroes.