Monday, October 30, 2023

SECU - Risk-Based Lending - Upping The Ante - #1  Over the last 12 months SECU has experienced a great deal of controversy - mostly unfavorable. If one had to choose a single issue of member discord, it would be the introduction of risk-based lending (RBL) at SECU in March, 2023. More than any other topic, RBL caused the highly unusual expulsion of three incumbent board members at the 2023 Annual Meeting. The three newly elected, member-nominated candidates - Perkins, Clements, Stone - all were firmly opposed to this lending practice. SECU has just announced the expansion of risk-based lending to personal and credit card lending effective November1, 2023 - along with substantial increases in loan rates.

Most working folks - and younger SECU members for sure - live paycheck to paycheck, without much margin for error.  These hard-working, two-income family folks are often just one major illness, one layoff, one extended-family emergency, one messy divorce away from financial catastrophe. Walking a financial high wire, without a safety net. And, in the "real-world, in real-life" really bad stuff does happen to really good people.

Evidently, the risk-based lending gurus at SECU believe the best way to help members, who have been side-swiped by unexpected financial adversity, is to charge them a higher rate on their loans.  If a member is struggling to make ends meet, then certainly "upping the ante"  by charging a much higher loan rate is bound to improve the member's ability to repay - right?  [
'Ya do follow that logic, don't 'ya?]  

But some good news, those same  SECU risk-based lending gurus have come up with a newly announced Member "Financial Life Preserver" loan which can be tossed out to members who are on the verge of financially "drowning"....