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CUs in debt challenge program saved consumers 20M
WASHINGTON (2/3/10)--Credit unions participating in the American Debt Relief Challenge have saved consumers an estimated $20 million that they would have spent on interest to keep their credit card balance at a large bank, the program estimated. The goal is to save American families $300 million overall, wrote Jamie Chase in an article posted on Monday’s Huffington Post titled “Measuring the Move: $20 Million and Counting.” The “move” refers to the Post’s campaign to get consumers to move their money to community banks and credit unions. “It's no surprise that searches to find local credit unions have tripled since the launch of Move Your Money,” Chase wrote. “It’s pointing the way to help make life just a little better for American families. The credit union movement soared in the Great Depression. People relied on their neighbors and friends to get through tough times. “It’s natural that people strapped with credit card debt, those facing foreclosure and small business owners with good credit that can't get a loan from the bank, are all looking to credit unions again now,” she added. Participating credit unions nationwide are sending in “consumer miracle stories,” Chase wrote. She told a story about credit union member Michael Wingate, who was overwhelmed when his Citibank credit card interest rate leapt to 40.99% from 4.99%. Wingate had a stable job, a good credit score and was making payments on time to Citibank. That interest rate was the highest she’s ever seen, Marylin Ball-Brown, CEO of Generations CU, Olympia, Wash., told the Post. “Wingate's increased [annual percentage rate] was the result of a predatory banking practice already addressed by the Obama administration's Credit Card Accountability, Responsibility and Disclosure Act of 2009,” Chase wrote. “While it curbs future abuses, the legislation unfortunately could not return Wingate's interest to a traditional rate. The credit union [Generations CU] saved the family $33,000 over the life of the credit card by transferring the $10,400 CitiBank card balance to an unsecured loan with a traditional rate of 12.2%.” To read the article, use the link.
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