LAWRENCEVILLE, Ga. — Gwinnett FCU here is expanding its skip-a-pay program.

"Because so many of our members are school system employees and government employees who are having three-day or five-day (unpaid) furloughs thrown at them because of the state and local budget cuts, we felt it would be a nice thing to give them the opportunity to skip a second payment," said President/CEO Marshall Boutwell. "Some credit unions already had two skip-a-pays in their policies. We're fairly conservative."

Less than 100 members take advantage of the program each year, Boutwell pointed out, and the vast majority of those who do are members with solid credit and have paid as agreed on their loans for years.

"Our members typically use it at Christmas time, right after Christmas, or when there's a summer vacation coming up. We offer them an opportunity to not make that credit card or car payment just to help them on a short-term cash flow basis," he added.

The skip-a-pay comes does cost members a $25 fee, as the product is essentially a loan modification. The $135-million credit union does not plan on changing its fee schedule for the skip-a-pay, or any other product, Boutwell added, saying that holding pat seems like the best move with members struggling in the recession and the CU "need(ing) the income as well to maintain safety and soundness."

Boutwell said that Gwinnett FCU is holding up fairly well in rough economic seas with only a "slight increase" in delinquencies on car loans, credit cards and signature lending products. Its delinquency ratio is around 1.5%, but the CEO said about two-thirds of that ratio is tied up in just a few mortgages and he's not anticipating the credit union taking any additional risks by allowing its members to miss two payments instead of just one.

Reviewing the File

"When you do a skip-a-pay it gives you the opportunity to look at the member's file, look at the payment history and if there is any reason to do it you may also pull their credit file to look at what is going on," he explained. "If somebody is in financial difficulty and if they were to ask for a skip-a-pay we're going to pick up on that. We take a look at the member-if they are really in trouble and they are trying to delay the inevitable, we will immediately start looking on a more in-depth modification."

Aside from various forms of lending modification, Gwinnett FCU offers its members credit counseling, budgeting and other financial literacy programs to help members get on track. It even has a car-buying service and is part owner of a mortgage company to help members find lower prices on their vehicles and slash closing costs on new homes.

"Instead of them going out and putting it on their credit card, they'll put it on their existing loans with the credit union," he said. "We're telling our members that we're thinking about their situation and if we can help them, we're here to do it."

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