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How Often Will Credit Card Rates Change?

2010-03-03T07:52:00Z

A lot of members are asking how often our credit card rates will change now that our rates are tied to the Prime Rate.

The shift to Prime Rate was in response to legislation passed by Congress to make changes in credit card rates more transparent. This was done primarily to protect consumers from having their rates raised with little warning. Our credit card rates were variable before, which meant they could have changed at any time. We seldom changed our rates because we’ve always wanted to keep our rates low and constant.

The effect of tying VISA rates to the Prime Rate means that changes are dictated by a widely publicized number, which most other loan rates (auto for example) tend to be tied too. This is a fairly consistent rate that over the course of the last ten years has experienced very little movement.

In looking at which index to use, we looked at the volatility of the index over the past 10 years. Prime only moved 6 points, from highest to lowest, over the past 10 years.

We decreased the chance of volatility even more by choosing to use Prime x .50. Movement of this index over the last ten years would have been 3 points, if you take the .5 multiplying factor into consideration.

Additionally, we lowered all rates when we made this change. We lowered our rates by .775%. That means Prime must go up by more than 1.55% for your credit card rate to get back up to what it was before we lowered it.

Online Banking Conversion

2010-02-23T21:31:00Z

We are in the throes of an Online Banking conversion. Computer conversions are never fun and online conversions are the worst.

The biggest problem for us right now is that the conversion required us to reset everyone’s passwords. To log in, you need to know the last four digits of your primary contact phone number and the last four digits of your social security number.

Some members have changed their contact information over the years, but didn’t think to tell us. So the phone number we have in our system may be different than their current phone number. We tried to communicate for months that we needed updated phone numbers for this conversion to go smoothly, but it is difficult to reach everyone.

Due to this issue, our phones were overloaded yesterday and some callers got a busy signal. We’ve been employing all sorts of means to keep phone lines open and capacity is far less of an issue today.

We are updating the front page of the website to answer the most common questions we’ve received since the conversion and are trying to keep all front line staff abreast of each issue as it arises.

Many of our members have been supportive and congratulatory of the ease of the new system. We appreciate that feedback.

Some are frustrated. We understand your frustrations and are working as fast as we can to alleviate them.

I want to give public recognition to our IT Department who has been working tirelessly on this since Sunday and a HUGE thanks to our phone staff. They generally have little to do with the decisions behind conversions, yet they hear the most feedback. They have been rock solid the last two days and I am grateful for them.

Bill's response to Verity's Bankrate.com rating

2010-02-18T01:11:00Z

While we certainly are dealing with the challenges that this economy is throwing at us, we are well-capitalized and expect to remain that way. Bankrate.com is a well-respected resource. In our case, however, their ratings formula does not appear to be capturing our essence.

Bankrate.com is a website which, among other things, produces a rating for each financial institution in the country. Although we do not know exactly how they calculate their rating, they apparently use publicly-available information and put in into their formula. For the quarter ending September 30, 2009, Verity received a low rating.

Should anyone be concerned about this? I don’t think so.

Our country is going through a difficult economy, with lots of unemployment. In addition, housing values have fallen considerably. We have been very aggressive in working with members so that they can remain in their homes while continuing to make their loan payments. Many of these workouts result in a change in the payment amount and so we must report them as delinquent loans. It appears that the formula used by Bankrate.com assumes that all of these loans are “non-performing”. The amount of these loans for Verity has climbed over the last year due to our philosophy that it is better both for Verity and our members to show flexibility with our members.

We believe that the way we have done things will result in more loans being paid as agreed over the long term. So far, this has proven to be true. In the meantime, we must follow the rules and record these loans as delinquent. We intend to continue this practice.

In an explanation of their ratings system, Bankrate mentions that the operating strategies of each individual financial institution “may lead to ratings that are not truly reflective of an individual institution’s financial situation”. We believe this to be the case with Verity. While we certainly are dealing with the challenges that this economy is throwing at us, we are well-capitalized and expect to remain that way. Bankrate.com is a well-respected resource. In our case, however, their ratings formula does not appear to be capturing our essence.

Chase’ing the Waves

2010-01-26T22:26:00Z

There are still local institutions that recognize you when you walk in the door. Places where text messages have not yet replaced real live people on the phone. Places that are not run by shareholders but by members, for members.

The past year and a half has brought a lot of change to banking in the state of Washington. WaMu, or Washington Mutual as it used to be known, was once a point of pride for Washington state residents. It was a big bank that did things the Washington way, with friendly employees who remembered names and faces. By July of 2008 it had become obvious to many of its shareholders and depositors that the Washington Mutual of the mid-90’s was long gone as billion dollar losses were reported.

It was during this time that I saw my first wave of new members arrive at Verity with official checks bearing WaMu’s name, their main concern being whether or not their funds were insured. As I explained that by structuring deposits into various CDs all their funds would be insured through the NCUA, I listened to their disappointment in how the local bank had let down its hometown fans.

The next wave came a few months later with the announcement of J.P. Morgan Chase’s purchase of WaMu’s operations in late September 2008. This time the tide was turning as these new members started opening more transaction accounts. Their checks still bore WaMu’s logo, with Chase’s name also present and printed on unfamiliar green check stock. The overwhelming sentiment I heard from these long time WaMu customers was that they wanted nothing to do with a bank headquartered almost 3,000 miles away in New York City.

A couple months ago, I started to see what I imagine to be the last wave of former WaMu refugees trickle through the door – those who decided to give Chase a chance and stuck around after the WaMu signs were taken down and the branches were remodeled. I assured these disillusioned members that banking as a whole had not changed.

Changes in Credit Card Rates in Plain English

2010-01-04T19:49:00Z

We are making some changes to our credit card rates. You’ll be getting information in the mail by the end of this week. Below is what we are posting to the website. I’d love to hear what questions members have.

We are changing our credit card rates so that they are now tied to an index with a margin.

The index we are using is the Prime Rate multiplied by .50. We chose to multiply the Prime Rate by .50 to reduce the degree of change in your rate. We like keeping your rate low and steady. If you’ve had a card with us for any degree of time, you know that we don’t like to change rates. However, the new credit card legislation makes it necessary to switch to a variable rate so that we aren’t saddled with the same rates for infinity. (After all, who knows what rates will be in 2047?)

You can find the Prime Rate that we will be using by reading the Western Edition of The Money Rates Section of the Wall Street Journal. The index is determined the 1st day of the month preceding the billing cycle date and that will be the rate we use for the index.

As of November 30, 2009, the highest Prime Rate was 3.25%.

Along with the index, your rate will be calculated by adding a margin. The margin is different for each person. The margins range from 7% (700 basis points) to 16% (1600 basis points), depending on your credit score.

The most important news is that this new method of calculating your rate will lower your credit card rate. You’ll be getting something in the mail soon that tells you exactly what your rate will be. So watch for it.

Local High Schools Lip Dub

2009-12-29T17:05:00Z

I may not have my stories straight, but from what I’ve heard, Shorecrest High School produced the first video and then Shoreline High School followed suit. Both videos are amazing! I’ve heard that those two schools have excellent film programs for students. This is clearly proof.

Verity Credit Union Employee Mentioned in CU Times

2009-12-27T20:29:00Z

If you’ve read my profile, you know I wrote a book.

My book was published in September of this year. I’ve been excited by the press it has gotten. It was featured in Redbook this month (page 110). It was in Body and Soul , HybridMom, BusinessWeek Online, UrbanBaby, Costco Connection, The Metro New York, The Nashville Examiner, The Globe and Mail, Ivey League Insecurities, Hip Slope Mama, Momasphere, and the Atlanta Journal Constitution.

I was even on KING 5 Morning News and Martha Stewart’s Radio Program and on two blog talk radio programs;

But this week I got a review from a publication that, as a credit union executive, is near and dear to my heart, The Credit Union Times. Being recognized in a publication that so many credit union employees respect, is one of my most proud moments to date. Claude Marx, thank you.

1 in 20 Plan to Buy a Home Next Year

2009-11-25T23:47:00Z

Move.com recently published a study that was subsequently printed by the Seattle Times. It reported that 1 in 20 people plan to buy a home next year.

When I read the headline, I thought that was good news. Apparently though, 1 in 20 is lower than previous years.

People are citing falling prices as the primary reason for their reluctance to buy.

I laughed because I remember in 1998, when my husband and I were contemplating buying our first home. We were worried because prices seemed so very high. My father-in-law gave us an interesting piece of advice. “Home prices are like a wild rushing river. There is no easy way to jump in. You just jump in and hope that you eventually keep up with the flow.”

I don’t know if that was good advice or not. He’s a doctor, not a financial advisor.

But we did “jump in” and it did turn out fine. We lived in that house for many happy years.

A few years ago a good friend was contemplating buying a home. But she was worried because housing prices were falling.

She got a piece of advice that WAS from her financial advisor. He said, “Don’t confuse your home with an investment and don’t confuse your home with line of credit. You should buy a house for the pure reason that you want to live in it for a long time.”

She did buy a condo and she has been happy with her purchase, even as housing prices fall. Falling housing prices do not lessen the feeling she gets when she works in her own garden. Just like rising housing prices didn’t increase the happiness my husband and I felt when we were finally able to buy a dog because we weren’t renting anymore.

I guess the point of my rambling post is directed to that 1 in 20 who are going to buy a home next year. There is so much talk about is it or is it not a good time to buy a house. Only you can decide that for yourself. And when you are making that decision, don’t do what so many consumers did for the past ten years – don’t think of your house as your retirement plan and don’t think of your house as your credit card. Think of your house as the place you want to grow a garden, own a dog, paint a wall, raise a family, or meet a neighbor.

I think if more people buy houses with that in mind, our economy will strengthen and stabilize over time.

Help Us Keep Kids Warm this Winter

2009-11-04T18:22:00Z

You can make a big impact on a child’s life by giving something as simple as a new coat.

We need your help keeping local children warm this winter. From now through Saturday, November 14, we are collecting coats and other warm clothing items to benefit the Society of St. Vincent de Paul, Clothes for Kids and NW Center.

Please bring any new or gently used coats, sweaters, gloves, hats and scarves to any one of our six branches: Auburn, Alderwood, Beacon Hill, Federal Building (downtown), Northgate and Wallingford. Branch addresses can be found here.

You can make a big impact on a child’s life by giving something as simple as a new coat. A representative named Richard from St. Vincent de Paul related this story to a Verity staff member. (The following is paraphrased):

A young girl arrived at the facility one day to receive her new coat. She was accompanied by her 16-year old brother. I asked the brother if he too was there to pick up a coat and he shyly said no, that he was just there with his sister. I noticed that the coat he was wearing was well worn and was much too small. After talking with the boy, I found out that the coat he was wearing had been given to him when he was 10, six years ago! I told him to pick out a coat for himself and his reaction was priceless. The look on his face and especially in his eyes expressed extreme gratitude. The smile he wore as he put on his new coat lit up the room.

Will you help us give a child a reason to smile this winter?

The economy struggles, but Verity remains strong

2009-10-13T18:23:00Z

"...while it remains a challenging year, we are still financially strong and expect to remain that way."

Over the last several months, we have really felt the impact of the struggling economy. Despite this, we are still in great financial shape.

In the month of September, we examined our portfolio of mortgage loans and decided to record “impairment. ‘ Impairment is recorded when you come to the conclusion that the decline in housing values may result in an eventual loss on a loan. We decided to get many of these potential losses behind us by recording a large expense in the month of September.

Many of our members are understandably under financial stress due to job loss and declining income. Our financial counselors have been busy helping these members develop plans so that they can meet their financial obligations to the greatest extent possible. Sometimes, these plans include a modification to their mortgage or other loans with Verity. When this occurs, we record impairment when the amount of the loan exceeds that value of the property. Only after the member has demonstrated the ability to make the new payments do we reverse the impairment.

The extra expense for September due to impairment in our mortgage portfolio was a little over $1.7 million. For the month of September, we show a net loss of over $1.6 million. For the first nine months of 2009, we show a net loss of $1.1 million. This has been an unusual year. In addition to the high loan losses, credit unions were assessed a premium by the National Credit Union Share Insurance Fund to cover the losses at two large corporate credit unions. We do not receive a bailout. We actually fund the bailout for other credit unions.

By taking a proactive stance now, we get a lot of the loan losses behind us. We do expect to continue to experience higher than normal loan losses into 2010, but with the belt-tightening that we are doing, the worst should be behind us.

As of September 30th, our reserve ratio is at 7.76%. The standard for being considered “well-capitalized” is 7.00%, so we have a nice cushion.

In summary, while it remains a challenging year, we are still financially strong and expect to remain that way.

Secure or Not Secure? There's no question.

2009-09-14T23:22:00Z

A couple of issues held us back from launching our new website today. They're fixed-- but we're going to wait until tomorrow to launch.

We choose secure.

Due to some issues with some new security features we are applying to the new veritycu.com, we were not able to launch today.

I was, ahem, peeved. I was steamed. But we're going to do this right or not at all. So knowing that the site will work as it should tomorrow gives me a sense of calm.

So, look for a new website to appear tomorrow morning around 7:00 a.m. PT. You get one more day to enjoy the current website.

Thanks for your patience!

The new veritycu.com: Not just another pretty web face

2009-09-10T23:05:00Z

veritycu.com is pretty, but it's got smarts, too.

So when visitors go to veritycu.com Monday morning (9/14/09), they'll see the new home page (screenshot below). We haven't been phished. We haven't been bought out-- it's really us.

While the site was designed for optimal Internet cruising on the latest and greatest browser versions (and on a 1024x768 screen), the minimum requirements are Internet Explorer 6.0 with 800x600 screen resolution. And, it will even work with a dial-up connection.

Other things of note:

The entire site will be locked down with an Extended Validation SSL Certificate. So, if you are using Internet Explorer 7.0, Firefox 3.0 and up, or Safari 2.0 and up, you'll see the "green bar" in your URL field which means you are on Verity's official website.
We've lost a little weight. We whittled away obsolete content and streamlined our product pages, creating comparison tables to help you pick the services best for you. And when you're ready to open an account, you can do so with a click of a button on our secure, online application. You can fund your new account at the time you apply, too.
Our Community. Over the years, Verity has grown its social media presence. We've found a way to gather our blogs on our home page. The most recent posts from all of our blogs can be found here.
Optimized for screen readers. If you are vision impaired and use software to "read" websites, veritycu.com is ready for you.
Text widget. Text a little small? Don't mess with your browser settings. Just click on the text widget at the top of the screen "AAA" to adjust the page to your liking.

Those are the highlights. I'm looking forward to launching on Monday and am very curious to hear what you think about our new website.

Home Page

Product Table

It will all be different on Monday morning: A new veritycu.com

2009-09-10T00:19:00Z

On Monday, Verity will have a new website. Here is a sneak peek.

I am happy to announce that the new veritycu.com will launch on Monday, September 14!

The process took a little over a year to complete. Unlike past redesigns, this was a project that involved a lot of people and a lot of gathering of data about how we do business and who does business with us (you, our members!) Before getting to the "fun" stuff of picking designs and layouts, our interactive web design partner took us through a discovery process that made us examine ourselves and our interactions with members. We did usability studies with volunteer members, non-members, and staff. We took advantage of best practices for navigation, search, content and layout. All of this discovery work resulted in a site that, hopefully, balances business strategy with optimal user experience.

Please note that this is a launch of our website, not of the new Online Branch and our new online banking system. I hope to have news of the status of that project at a later date.

So, here is a screen shot of the new home page. Tomorrow, I will post another screenshot and talk about the new features. I will also share some tips on how to be prepared for perusing our new website come Monday, September 14.

Home Page

FREE Credit and Money Management Seminars Next Week

2009-09-09T19:15:00Z

If you are struggling with making ends meet, are rebuilding your credit or are simply in need of a kick in the pants to jump start your savings, we hope to see you next Wednesday or Thursday.

Faced with new economic challenges, many people are paying closer attention to their finances these days. As the nation’s savings rate slowly continues to climb, it’s clear that habits are shifting. With this renewed focus on financial sustainability, Verity is offering a free seminar on Credit and Money Management.

You can choose to attend Wednesday, September 16, at our Alderwood Branch, or on Thursday, September 17, at our Northgate Branch. The seminar begins each evening at 6:30 and concludes at 8:00pm. You are welcome to attend both nights if you wish!

Verity’s financial counselor, James Lupori, will cover the basics of credit reports as well as money management techniques designed to help you save more and spend less. He will also take some time to answer audience questions.

If you are struggling with making ends meet, are rebuilding your credit or are simply in need of a kick in the pants to jump start your savings, we hope to see you next Wednesday or Thursday. To reserve your spot, call Joe Lancaster at (206) 315-6718.

Our Alderwood Branch is located near the Alderwood Mall at 18530 33rd Ave W in Lynnwood. The Northgate Branch is at 11027 Meridian Ave N, in North Seattle, on the west side of I-5.

Verity Gains 2,828 Pounds for a Good Cause

2009-08-26T19:46:00Z

Verity gained 2,828 pounds and then lost it, all in one month! Or rather, we gave it away to food banks in our community.

Our last quarterly breakfast started off like any other, with lots of food. We’re generally served by 7:30 and have half an hour to eat and socialize before we get down to business. Just as 8:00 approached, Pete Spalding, a member of our Corporate Citizenship Committee, stood up and asked everyone, “Did you get enough to eat this morning?” We all nodded our heads, most of us with satiated grins on our faces.

Pete went on to make a passionate plea for those families in our community who did not have breakfast that morning. He reminded us of the many people currently out of work, or struggling to make ends meet.

He reminded me to be thankful for the abundance surrounding me and to be thoughtful of those less fortunate.

His reminder must have touched a lot of people that morning because in less than one month the staff of Verity collected 2,828 pounds of non-perishable food items for local food banks as part of our second annual Dare To Care food drive. We also donated $460 in cash. An internal chili cook-off and bacon bowl (don’t ask!) helped our internal fundraising efforts and we also received donations from members.

September is Hunger Action Month. Find out how you can help fight hunger at Feeding America. Not only can you make a donation through their site, you can also find ways to get involved in your own community, read stories from Americans affected by hunger, and become an advocate to engage your elected officials and support Child Nutrition legislation.