While congressional leaders work to push through a deal to raise the government's debt ceiling, some credit unions that serve federal employees aren't taking any chances.

Institutions in Maryland and Washington have developed programs to assist their members in the event Congress fails to raise the government's borrowing limit and Uncle Sam can't pay workers' wages or retirees' benefits this month. They are prepared to offer low-rate or interest-free loans and allow borrowers to skip some loan payments to get through the financial crisis.

It's not the first time these credit unions have come up with such emergency plans — and might not be the last.

"We literally are going to stay on standby," says Juli Anne Callis, president and chief executive of the National Institutes of Health Federal Credit Union. "Our readiness level is high and we're ready to move as needed."

Credit unions started devising payroll disruption programs for federal workers in the spring, when the budget battle in Congress threatened a government shutdown.

Though the White House and congressional Republicans negotiated a settlement, the pressure to cut government spending continues to endanger federal workers' paychecks. Nearly 4,000 Federal Aviation Administration employees, for example, were furloughed last month when Congress failed to fully fund the agency.

Maryland Bankers Association President Kathleen Murphy says banks, too, are willing to work one-on-one with customers dealing with a financial crisis from an "act of God or inactivity of Congress."

But federal credit unions — nonprofits owned by their members — are more likely to see depositors whiplashed by the debt debate raging in Washington. Banks have customers from all walks of life, but credit unions serve a more limited pool. All their members could work at a single federal agency. And if the government suspended their pay, every member of the credit union would be adversely affected.

The credit union that serves employees of the Bethesda-based National Institutes of Health figured nearly all of its 44,000 active members would feel the pinch if Congress failed to raise the debt ceiling.

Callis says the NIH credit union started gearing up last week to offer expedited lines of credit and a program that would allow members to suspend loan payments for up to three months without affecting their credit scores.

The Transportation Federal Credit Union has more than 18,000 members, including some furloughed FAA employees.

To help furloughed workers, the credit union is offering personal loans worth one net paycheck — not to exceed $3,000 — for up to 18 months at a rate of 4.5 percent, says Jeff Arvai, its president and chief executive. Arvai says the lowest rate on an unsecured personal loan ordinarily is 7.45 percent.

These members also can skip up to two monthly payments on credit cards and loans issued by the credit union, Arvai says. Interest accrues, but, he says, there are no fees attached and the skipped payments won't be reflected on their credit report.

Similar loans would be extended to other members affected by a debt ceiling impasse.

Andrews Federal Credit Union in Suitland has more than 90,000 members, most of whom serve in the military.

Suzanne Curren, a spokeswoman for the credit union, says it is prepared to give service members an advance on their paychecks in mid-August at no interest if Congress doesn't raise the debt ceiling.

For other federal workers, the credit union planned to provide a no-interest loan in an amount equal to their last direct-deposited paycheck.

Curren says the credit union heard from members here and overseas who were worried about their paychecks and asking for account balances and whether loans are available.

"For the young airmen and military, they are on the front line," Curren says. "It's in some ways disconcerting they would be thinking about this while they were on the battlefield."

HEW Federal Credit Union, which represents employees from the departments of Education and Health and Human Services, received as many as 50 calls about the debt ceiling crisis late last week.

"They have called and expressed concern that their bills won't be paid," says Kathleen Geary, president and chief executive.

She says the credit union has a short-term, interest-free loan program, similar to the one it created 15 years ago when federal workers were furloughed for several days, ready to go,

Ideally, workers and retirees have six month's worth of living expenses set aside in an emergency fund for just this sort of crisis. If you don't, check if you can join a credit union, which is likely to give you favorable terms if you do have to borrow.

eileen.ambrose@baltsun.com

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