Delaware League Gets First CU for Student Loan Program
Louviers Federal Credit Union in Newark, Del., signed up to adopt the Custom Loan Source program offered by the league in partnership with Education Loan Source.
Jane Bailey, executive vice president of the Delaware Credit Union League, said that she looked at other student loan programs adopted by credit unions but felt they weren't the right match.
"We don't have huge credit unions in Delaware, so we needed a program that fit that niche. We needed something turnkey and totally customizable."
The league plans to officially launch the program at the end of the month at its lending council, but Bailey said that word has already traveled.
"It took off like a rocket. We've already had credit unions calling with questions saying that they don't want to wait until the end of the month."
Bob Walls, director of human resources and special projects at Louviers, said that the credit union already had developed a relationship with the University of Delaware to cultivate an in-house private student loan product for the school's executive MBA program when he heard about the league's program.
Louviers' product mirrors the federal program, Walls said, and so far they funded four loans for students that needed extra help beyond the federal Grad Plus loan.
The credit union will start the Custom Loan Source program by offering loans for graduate students in the Alfred Lerner College of Business & Economics program at the University of Delaware.
As the credit union rolls out the program and works out the kinks, Walls said it will look to offer the product to other graduate programs and other business schools in Delaware and eventually to undergraduate students.
To provide additional security, Louviers worked out an agreement with the dean of the Alfred Lerner College so that if there is a student that doesn't make payment on the loan, the school will put a hold on his or her transcript until the payment is made.
The league's timing in introducing the program was perfect for Louviers because the credit union just build a new headquarters next to graduate student housing at the University of Delaware that will open in January. The building will have an Internet caf? for students to use and will have rooms that college clubs can use.
Originally, Walls said the credit union wanted to open an on-campus branch completely run by students in the business school. The plan hit a road block that Walls hopes the credit union can soon work around. A local bank has an exclusive agreement with the university for offering products on campus that prevents the credit union from opening the branch.