Vermont Development Credit Union
Vermont Development Credit Union
BackgroundFounded in 1989 by Burlington Ecumenical Action Ministry, Vermont Development Credit Union (Vermont Development) is dedicated to providing access to affordable credit and financial services to low-income and underserved Vermonters. In thirteen years, Vermont Development has made over 9,300 loans totaling $78 million. It is a state regulated and federally insured Community Development Financial Institution.
Programs Vermont Development provides financial services to a population that is not served by traditional financial institutions and is often targeted by predatory lenders. In addition to the standard services found at most banks or credit unions, Vermont Development offers some unique products and services.
These include loans that range from $50 to $150,000, including “Job Wheels” transportation loans, “Working Wheels” loans to those in transition from welfare to work, Adaptive Technology loans for people with disabilities, and Individual Development Loans for education, credit consolidation, financial emergencies and helping people establish a positive credit record. Other types of loans focus on energy saving investments in homes and farms, micro-enterprise loans, small business loans, affordable mortgages, and home improvement loans.
Vermont Development provides development services that include budget counseling, homeowner education and small business counseling. They also encourage membership with a low $5.00 membership fee and with a minimum savings deposit of just $5.00.
Client Population Vermont Development has 10,000 members in 205 Vermont towns. Eighty percent of the membership is low-income. Half of the members are women. Most have limited financial assets and many have experienced past credit problems. Many local nonprofit organizations are also members.
Investing with Vermont Community Development Credit UnionOn behalf of our clients, TAMC made it first investment with Vermont Development in 1999.
TAMC will make investments with Vermont Development of at least $5,000 for a term of not less than two years.
Impact The need for Vermont Development’s services is demonstrated by their growth. In 1990, the first full year of operation, they loaned $235,000. In 2002, they made 1,994 loans totaling $20.8 million. These loans enable low-income Vermonters to buy and repair homes, start and expand micro-enterprises, obtain education, get better jobs, and achieve financial stability. Thousands of Vermont Development members also build financial stability by saving, learning to avoid high-priced debt, and building positive credit histories.
Impact Stories
In 10 years of living in subsidized housing, Brianna Parry never stopped dreaming of owning a home where her children could play outside and she and her husband would not share a bedroom with their toddler. Last year, Vermont Development’s Home Dollars program made their dreams come true. Vermont Development used a grant from the Federal Home Loan Bank of Boston to match their savings four to one. Using these savings and a Vermont Development mortgage, they purchased Brianna’s childhood home and converted the garage into an apartment for her parents.
“Our total ownership costs are less than our old rent,” says Brianna, “and we have the benefit of having my parents on site. There are so many people like us just trying to get our feet on the ground. Vermont Development made it possible.”
Winston Lacasse is disabled from a farming accident when tons of falling machinery severely injured his shoulder and ribs. He receives Social Security and a Section 8 housing subsidy. Winston was invited to buy the 1958 General-model trailer where he lives. He was nervous because he had no credit history and a limited income. Vermont Development Credit Union showed him he had an important asset. “I had always paid my rent on time,” Winston says, “and always left a place cleaner than when I moved in. They took my landlords’ references for five years back. That’s all they needed to make me a loan.”
