Immigrants paying 120% interest on loans get relief
A Saskatchewan community is helping newly arrived immigrants clear off some high interest loans associated with moving to Canada.
In the last year and a half a group of immigrants from Ukraine settled in the North Battleford area, west of Saskatoon, with many borrowing money to finance the journey.
According to the Ukrainian-Canadian Congress some were paying interest rates of 10 or 12 per cent, per month, to lenders in their home country. On an annualized basis that works out to an interest rate of 120 per cent to nearly 150 per cent, leaving some immigrants struggling to meet payments.
When the area's Ukrainian-Canadian community learned about the situation they approached a local credit union, which agreed to provide new loans at a lower rate of interest.
John Jangula, spokesman for Innovation Credit Union, said he did not view the new loans as high risk.
"I guess I'm looking beyond just the normal credit score and looking at the situation," Jangula said.
One of the people benefiting from the lower-interest loan program is Nick Ivanchenko, who has been working as a welder in Battleford for 15 months.
"I want to buy house, nice car, and get married," he said.
Now his $7,000 loan — which had an interest rate of 12 per cent per month — has been paid off. Ivanchenko has a new credit union loan with payments that are more manageable and is also building a positive credit rating.