March 2020 is a month that will live in history books forever. At the start of the COVID-19 pandemic, we anticipated financial challenges and economic changes ahead. So, we quickly pivoted our work to explore new ways to support our members and anticipate their needs during this uncertain time.
At the onset of the pandemic, we swiftly implemented the following measures to help our members:
For the health and safety of our members and team, we made the difficult decision to adjust our hours and branch lobby availability throughout the year as we monitored positive COVID levels in each Michigan region. During this time, many of our communication efforts included educating members on their many digital account management options: Online, Mobile, and Text Banking; fee-free CO-OP ATM access; and video teller machines.
Though we had already planned to implement video teller machines in the drive-thru of our Grand Haven, Okemos, and DeWitt branches before the pandemic, the addition of these new machines offered a valuable service. This contactless option made it possible for our members to safely connect with Lake Trust team members in real-time when our branch lobbies were closed or reduced.
As another avenue of support to our members, we partnered with CacheFlo in April and June to offer free financial webinars focused on topics like budgeting and planning for uncertain times.
During the live webinar 456 members participated, and another 744 members signed up to receive recordings of the event. This was the first time we’ve ever offered this type of learning opportunity.
While the pandemic undoubtedly impacted individuals and families, many businesses faced financial challenges as well.
As partners to our business members, we try to assist in times of need to ensure long-term success. For the first time, we offered the option for commercial loan payment deferrals to help our business members save for more pressing expenses. In 2020, we processed 116 commercial payment deferrals, totaling $5.5 million. The paused payments provided relief at a critical time for our members who were dealing with cash flow uncertainty.
As the pandemic continues into 2021, we’re keeping a close watch on the effects of this event to make sure our members are supported.
We understand the vital economic and social impact that small businesses play in local communities. So, when news was released of the federal Paycheck Protection Program (PPP), our team worked tirelessly to support our business members. This forgivable loan could be used for mortgage/rent payments, purchasing personal protective equipment (PPE), and keeping employees on payroll.
The prospect of this financial support offered hope to business owners who were forced to close their doors during the executive ‘Stay Home, Stay Safe’ order or who faced large financial losses due to the pandemic. For perspective, in Washtenaw County alone, the average small business saw a 19 percent decrease in revenue last year (compared to 2019). Hospitality, hotel, and restaurant sectors were among the hardest hit industries, earning up to 42 percent less revenue.2
Knowing that the PPP had a short timeline and limited funding available, Lake Trust team members who normally focus on consumer lending jumped in to help guide our business members through the application process. This swift change in resources allowed our Business Lending Team to process and submit applications quickly in the hopes of securing more funding for our members. Many business owners later shared that they appreciated the personal service we offered during this stressful time.
Even after the first round of funding, the forgiveness process for PPP loans still lacked clarity. To advocate for our members, Andrea M., our Senior Vice President of Lending, joined the SBA PPP Task Force through the Michigan Credit Union League. In addition, we asked our business members to help us support draft bill S. 4117, which would streamline the forgiveness process of PPP loans under $150,000.
By the end of 2020, we had helped 244 businesses in Michigan access over $13 million in PPP funding.
There’s power in all of us to make an impact through the work we do each day.
The fluctuating economy in 2020 created a favorable environment for home loans, with mortgage interest rates at historic lows. As rates dropped, we started to see an increased interest in mortgage refinances from members who were looking to save money on their monthly payments or reduce their loan term. Refinancing often includes several upfront costs, so we reduced our lending fees to just $99 to help our members save even more. This resulted in an average savings of $989 on closing costs.
While helping our members save money is an important focus of our work, we also wanted to use this opportunity to give back to those in need. The pandemic has had a devastating impact on many Michigan families, and area housing nonprofits have seen an increased need for their services. Later in the year, we continued to offer lending fees for only $99 and also promised to donate $99 to housing nonprofits focused on COVID-19 relief efforts in Michigan through the Lake Trust Foundation.
By December 31, 2020, we had helped members save approximately $475,000 on mortgage refinance closing costs with our reduced fee offer.
Our refinance campaign continued into the first quarter of 2021, as rates remained steady. We plan to distribute the donations that resulted from this campaign to the participating nonprofits later in the year.
In addition to supporting our members and communities throughout the pandemic, we recognized the importance of supporting the financial wellbeing of our team as well. Like many families in Michigan, our team members and their families also faced employment status changes in their households or reduced hours at positions outside of Lake Trust. To help, we launched a Team Member Assistance Fund with an initial contribution of $30,000.
Our new assistance fund provided a financial cushion for some team members during the pandemic and will continue to be utilized beyond this time. Funds can be distributed in the event of an economic hardship due to a natural disaster, severe illness or injury, death, or other circumstance beyond the team member’s control. We realize that an unexpected life event can have a major impact on a household budget. And we want to support our team as much as possible.
Lake Trust team members continue to have the option to add to our assistance fund by making a bi-weekly contribution. As a close-knit group, we’re here to support one another in times of celebration and during moments of struggle. That’s the power in all of us.
1Third party website. Lake Trust Credit Union is not responsible for the content, availability, security or compliance of any linked third party websites. In addition, the site's privacy policies may differ from those of Lake Trust.
2EntryPoint Releases New Washtenaw County COVID-19 Business Impact Report To Support Small Businesses. (2021, February 8). EntryPoint. Retrieved from https://entrypointmi.com/2021/02/08/entrypoint-releases-new-washtenaw-county-covid-19-business-impact-report/