NAPERVILLE, Ill. — Thanks to an alliance involving eight Illinois credit unions, students will have access to more than $100 million in college loans for the 2008-2009 school year.
Credit unions are investing in securities issued by the Illinois Student Assistance Commission, according to the Illinois Credit Union League. Alliant CU, Baxter CU, CEFCU, Corporate America Family CU, Credit Union 1, I.H. Mississippi Valley CU, Motorola ECU and Scott CU have agreed to put up the funding.
The Stafford loans being offered through the partnership offer lower interest rates, the league said. The involvement of Illinois credit unions began after other financial institutions that previously backed ISAC informed the agency they would no longer provide funding for its loans, a trend that is being felt by similar agencies across the country, the league said. Andrew Davis, ISAC executive director, contacted the league and an initial meeting was set to discuss the possibility of working together.
After meeting with Davis, the league determined that investing in the bonds would be permissible under applicable provisions of the Illinois Credit Union Act, an opinion in which the Illinois Department of Financial and Professional Regulation concurred.
ICUL then met with several of its credit unions to determine their interest in investing in ISAC securities, and they in turn committed the $100.5 million.
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