View From the Board: ITIN Lending

Provided by Robin Larsen, DCUC Board of Directors Member and president/CEO, Cobalt CU

ITIN (Individual Taxpayer Identification Number) lending is important to credit union members, especially for those who might not have a Social Security Number but still want access to credit and financial services in the United States.

Having an ITIN lending program allows credit unions to offer financial services to individuals who may otherwise be excluded from traditional banking channels. This often includes immigrants, individuals on dependent visas, or foreign students.

By offering lending products to members with ITINs, we enable them to access credit for various purposes such as buying a home, a car, or starting a business. This can be crucial for them to achieve financial stability.

Establishing credit in the United States can be challenging for people without social security numbers. ITIN lending provides a channel for these members—ultimately helping them qualify for better terms on loans and financial products. Recently, we had a local real estate agent refer a couple with an ITIN to us. They had been renting a home for over nine (9) years. They thought being a homeowner was out of the question for them. One of our Mortgage Loan Officer’s helped them through the process, and we were able to finance a new home for them and their one-year-old son. The members are grateful that we were able to help navigate them through the process with great service and obtain a good mortgage loan rate.

Another example of helping a member with an ITIN came recently when a nonmember who had his automobile loan with a major bank came to us for help after learning we had an ITIN program. His bank was charging him 27.75% on his auto loan resulting in a $775 payment each month. Digging deeper with this individual, we learned he also had a personal loan elsewhere with a 25% rate. After he worked with our Branch Manager, we gained a new member who now has his auto loan with us with a 12.24% rate and $277 monthly payment. We refinanced his personal loan to a lower interest rate, dropping his monthly payment from $415 to $103. This member is now saving $810 a month with the lower payments and able to deposit the savings into his credit union share account. The member told us we have made his life better by saving him money and allowing him to steer away from predatory lenders he had been using. We are now working with him on his goal to purchase his first home and financing it with the credit union.

In the first ten (10) months of implementing our ITIN program, we have helped nineteen (19) families buy a home and over fifty (50) members with personal and/or automobile loans. ITIN lending aligns with our mission to serve our community. In providing financial services to a diverse range of members, including those with ITINs, we are contributing to economic development and empowering the underserved. And we are proud to be a part of it!