West End Neighborhood House

Press Releases

For Immediate Release: July 16, 2009
Contact: Molly Keresztury
Day Phone: (302) 658-4171
Night Phone: (304) 282-7932
Email: mkeresztury@westendnh.org

West End unveils statewide low-interest loan program

United Way of Delaware, Wilmington Trust, Catholic Charities and the YWCA partnership creates “Loans Plus”

Wilmington, July 16, 2009 – West End Neighborhood House, Inc., announced the statewide expansion of its highly successful low-interest loan program – now called Loans Plus. This program helps Delawareans break free from the cycle of predatory lending known as payday lending. In addition to the announcement of the expansion, Gov. Jack Markell signed Senate Bill 108 at West End, which imposes tougher standards on the payday lending industry. Revenue raised from this bill will directly fund programs such as Loans Plus that promote safe lending and financial literacy and education.

With the sponsorship of Barclays Bank, FHL Bank of Pittsburgh, ING, TD Bank, United Way of Delaware and Wilmington Trust, and with the partnerships of Catholic Charities and the YWCA, Loans Plus is expected to help thousands of low-to moderate-income working Delawareans secure low-interest, same-day cash loans while learning to make positive financial choices.

“West End has helped hundreds of people achieve financial stability and end payday lending debt,” said Barbara Reed, Director of the Housing and Financial Management Program at West End. “With the help of our dedicated partners, I am thrilled that our program has increased its capacity to serve Delawareans by 200 to 300 percent annually.”

Loans Plus offers small, same-day cash loans averaging from $300 to $500 with minimal interest rates (never to exceed 15 percent) and a realistic repayment plan. Loans Plus services include financial literacy education and the opportunity to establish, or re-establish, positive credit. In the past 18 months, West End has helped nearly 400 people with $160,000 in loans. To date, 93 percent of customers have successfully re-paid their loans, saving them hundreds or thousands of dollars in interest.

“Predatory lenders have devastating effects on our communities and I’m proud that West End took the initiative to offer a safe alternative to high-interest payday loans,” said Gov. Jack Markell at the ceremony. “While Loans Plus helps people with the cash they need now, more importantly, it helps them plan for the future and decrease their dependence on short-term loans.”

Loans Plus is currently the only loan program of its kind in Delaware and is being used as a model for the Federal Deposit Insurance Corporation’s (FDIC) National Small Dollar Loan program being piloted in several other states. Loans Plus is now accepting applications at their six service centers statewide. Loans Plus now offers services at three Catholic Charities locations and two YWCA locations. West End, the initial location of the program, will continue to offer services in Wilmington.

“Loans Plus offers a critical resource to struggling Delawareans,” said Michelle A. Taylor, President and Chief Executive Officer of United Way of Delaware. “This expansion of services will help an increasing number of hardworking local families avoid predatory lenders and break the cycle of debt.”

Three-year projections of the expansion indicate that at a rate consistent with West End’s current figures, the collaboration has the potential to originate 3,900 loans, lending $1.6 million to Delawareans. Compared to the same dollar amount loaned at an annual 730 percent interest rate by payday lenders, this equates to a savings of $2,016,900 in interest alone, allowing Delawareans to utilize the savings for other products or services during this economic downturn.

“We are proud that the FDIC has looked to our program as a model for others and are pleased to continue to work with West End Neighborhood House to bring programs that offer financial soundness and education, like Loans Plus, to the communities we serve in Wilmington and throughout Delaware,” said Robert V.A. Harra Jr., president and chief operating officer of Wilmington Trust.

West End Neighborhood House, which recently celebrated its 125th anniversary, helps over 11,000 low- to moderate-income individuals achieve self-sufficiency and economic independence annually. The variety of services offered at West End include before and after school child care, tutoring, adult employment training and educational services, transitional housing for former foster-care youth, affordable housing and community revitalization efforts.

For more information or to apply for a loan, call 888-936-4727 or visit www.westendnh.org.

Loans Plus services are now available at the following locations: Catholic Charities centers in Wilmington, Dover and Georgetown; West End Neighborhood House in Wilmington; YWCA locations in Newark and Georgetown.