PAYDAY ALTERNATIVE LOANS

Have you ever thought one more paycheck would make all the difference?

We are now offering an alternative to high-cost payday loans, the National Credit Union Administration (NCUA) allows us under its regulation to offer small-dollar loans called payday alternative loans (PALs).​

​PALs include specific consumer protection features:

  • Loan amounts between $200 to $1,000
  • The borrower must be a member of the federal credit union for at least 30 days
  • The term of the loan must range from 1 to 6 months
  • An application fee of $20
  • The PAL cannot be rolled over

Disclosure Information

Here at GHS we are introducing a new short term loan option to help you make ends meet. 

Service Cost
Rate 28%
Application Fee $20 one-time fee

 

What Else You Should Know 

  • Principal – The principal of the loan is not less than $200 or more than $1000 
  • Aggregate Dollar Limits – The Credit Union includes, in its written lending policies, a limit on the aggregate dollar amount of loans made under this section of a maximum of 20% of net worth and implements appropriate underwriting guidelines to minimize risk; for example, requiring a borrower to verify 43 employment by producing at least two recent pay stubs.

Applying is Easy

Get a PAL  through our simple 3-step application process. GHS Federal Credit Union requires the following documents:

  • Loan application
  • Two most recent pay stubs (if self-employed, last two years of tax returns)
  • Other information/documents as requested by GHS Federal Credit Union (non-members must provide a copy of their photo ID)

 

Not a member yet? Take advantage of membership benefits, financial products, and services. Credit union members enjoy access to the following and more:  

  • Access to free ATM networks
  • Online and mobile deposits, banking, and eStatements
  • Picture pay
  • Voice banking
  • Business and personal loans
  • Free checking

PALS FAQ

Do all credit unions offer PALs?
GHS Federal Credit Union is exceptional–most credit unions don’t offer payday alternative loans. As recently as 2017, only 1 in 7 credit unions did.

It’s often beneficial to apply for a PAL through a credit union because unlike traditional banks, credit unions are cooperative, member-owned, and not-for-profit

That means profits are returned to members through reduced fees, lower interest rates, and greater savings. As a result, it’s in a credit union’s best interest to look out for their members.

Why are PALs safer than traditional payday loans?
There’s a reason most financial counseling advises against conventional payday loans, which are typically for high amounts over a short term (around two weeks).

The payday loan model is based on the assumption that borrowers will be unable to repay the whole amount promptly, meaning the lender makes money on the extremely high interest payments. Typically, they will attach finance charges if borrowers are unable to pay back their loan with the next payday.

By contrast, PALS don’t set borrowers up for failure. PALs offer more manageable payments with lower interest rates and no additional fees.

Does it affect my credit score?
Credit unions send your PAL repayment reports to the major credit union bureaus. If your payments are ontime, this can improve your credit score.