In the past few months, credit unions across the country, especially ones with close military connections, have responded to sequestration in such ways as launching awareness campaigns, hosting educational workshops, rolling out emergency loan products, offering new saving options and slashing fees for members facing furlough or unemployment.

Here are three examples of how the credit union industry has responded to sequestration:

• The $188 million Northern CU in Watertown, N.Y., began offering assistance such as 60-day, no-interest loans to help members employed at Fort Drum facing an 11-week furlough that began July 8.
• The $405 million CBC FCU in Oxnard, Calif., is providing a line of credit (up to two months of applicants' net pay with interest-free financing through 2014) for about 5,000 members who work at a local Navy base.
• The $1.7 billion Robins FCU in Robins, Ga., is offering members who work at the Robins Air Force Base special furlough loans, refinancing car loans, home mortgage-loan assistance, a skip-a-payment option and extending terms of current loans.

Here's a closer look at five ways that credit unions are assisting members during the current sequestration.

Next Page: On the Phone or in Person

1. Phone Hotlines, Prompt Action and Personal Service

Sequestration hotlines began popping up this spring at credit unions across the country, including the $54 billion Navy Federal Credit Union.

“As their dedicated banking partner, we've been providing phone and in-person assistance to help them overcome any financial difficulties,” said Claudia Warszawski, a personal finance manager at the Vienna, Va.-based credit union, the world's largest. “We're doing what we can to provide assistance, and encourage all current and potential members to contact us to review their options and seek relief.”

In addition to setting up a phone hotline, Navy Federal launched other initiatives to help members cope. For example, the credit union said, members can access military pay direct deposit one business day after sequestration assistance is approved.

As another effort to provide helpful information as quickly as possible, Navy Federal is offering members advice on coping with sequestration such as:

• Set a budget and cut unnecessary expenses
• Adjust means of transportation
• Make it a family goal
• Talk to creditors

Some credit unions are receiving extra recognition for their sequestration assistance programs. Adding a phone hotline and other efforts at the $353 million Air Force Federal Credit Union helped the 37,000-member organization earn the highest rankings among military Fis in a survey by GoBankingRates.com.

Next Page: Let's Sit Down

2. Workshops and Financial Counseling

Financial coaching and educational workshops related to sequestration are being implemented at many credit unions, including the 26,000-member Belvoir Federal Credit Union in Woodbridge, Va.

In the past few months, more than 50 Belvoir Federal members attended free seminars topics such as “Taking Charge in Tough Times” and “It's a Matter of Life and Debit” in recent months, the credit union said.

In addition, the $310 million credit union, which has served the Fort Belvoir and U.S. Armed Forces community since 1946, is offering other assistance for members facing furloughs, such as emergency loans. For example, qualified members with existing direct deposit can borrow up to $5,000 at a fixed rate of 4.99% APR (0% APR for the first 60 days with a maximum term of 12 months) and may defer their 1st payment for 60 days, the credit union said.

Since March, Belvoir Federal reports that it has aided 20 members with individual financial coaching, four members with emergency loans, seven members with loan workout options and six members with skip-a-pay.

The $2.6 billion Wright-Patt Credit Union, which is the official on-base credit union for Wright-Patterson Air Force Base in Dayton, Ohio, collaborated with U.S. Air Force officials, the Dayton Development Coalition and Montgomery County's Workforce Development Division to provide assistance to those affected by defense cuts. For example, the groups hosted an information fair on the base and a community resource fair at a local university, according to WPCU's website.

At the $304 million CommonWealth One, a hotline has been established and members can tap into a free, online debt analysis tool, Debt In Focus, which provides a personalized financial assessment and creates a monthly budget.

“We're here to help our members through the challenges of facing a reduced income,” said Ashley Baldeon, marketing manager for the 36,000-member organization in Alexandria, Va. “We thoroughly support 'people helping people.'“

Baldeon said the first step in the process is for members to understand their financial situation before they can factor in the impact of sequestration on their income.

Next Page: A Lending Hand

3. Emergency Loans, Loan Assistance and Skip-a-Pay

Offering emergency loans, loan workout options and skip-a-payment programs are effective ways for credit unions to provide a financial parachute for members trying to stay afloat during hard times, according to credit union leaders.

The $16 billion, 1.2 million-member Pentagon Federal Credit Union in Alexandria, Va., is promoting the following services for furloughed employees:

• Members may skip a payment for all loans except real estate loans.
• Members can request a one-month due date bump during each month the furlough continues. with interest continuing to accrue on the loan.
• Debt consolidation loans.
• “Furlough Loans” of up to one month's net pay for a maximum term of 12 months at 7.99% APR.

Other credit unions are also tailoring loan products. The $1 billion, 78,000-member North Island Credit Union in San Diego is offering a special 3% APR signature loan with no collateral required, to qualified members that have been furloughed, according to the credit union's website.

Other credit unions are also offering special assistance and emergency loans. The $1 billion HanscomFCU at Hanscom Air Force Base in Massachusetts began offering its Life Line loan on March 1, the day the sequester cuts kicked in.

Members have access to a 0% APR interest line of credit for 30 days, equal to one month's net payroll up to $5,000, according to the credit union, and the loan is attached to the member's checking account to provide additional funds to cover checks, ATM withdrawals and debit card purchases.

Next Page: Pull the Penalties

4. Penalty-Free Early Withdrawls

Penalty-free early withdrawals on certificates of deposit are another option many credit unions are offering to aid members undergoing furloughs.

For members that need to redeem a certificate of deposit prior to its maturity, some credit unions, including Navy Federal, are waiving early withdrawal penalties.

The $124 million Keys FCU in Key West, Fla., is also offering penalty-free withdrawal on share certificates to those affected by sequestration, according to a recent CUNA report, along with the ability to skip one payment on an existing loan for no additional fee, and a sequester loan in which members can borrow up to $5,000 at 1% annual percentage yield for 36 months.

There's also no penalty for early withdrawal of share certificates at the $675 milion SACFCUin Bellevue, Neb., which is also offering loan modifications, skip-pay options, emergency short-term loans, and financial counseling, the credit union said.

“We value our members and appreciate the hardship sequestration is causing,” said Gail DeBoer, president and CEO of SAC FCU. “Our goal is to serve our members, whatever the situation.”

Next Page: It's in the Cards

5. Reduced Fees and Credit Card Deals

The $71 million San Diego Medical FCU is among the growing number of credit unions offering no-fee sequestration loans and other services. Through Sept. 30, 2013, according to the 5,100-member credit union's website, qualified members can tap into a sequestration loan program that offers:

• No origination fees
• $2,500 available during sequestration
• 0% APR (through Sept. 30, 2013)
• Repayment begins Oct. 1, 2013 at 6% APR
• 24-month repayment period

Loans aren't the only areas experiencing fee reductions. Navy Federal announced recently that it is offering a special 3% fixed-rate APR on checking overdraft line of credit through June 30, 2013 for federal government civilian employees that have direct deposit and are subject to furlough.

The $400 million, 42,000-member America's Credit Union in Lewis-McChord, Wash., is offering expedited approval to increase credit limits for existing ACU cardholders impacted by sequestration, according to ACU's website, and is also offering a promotional rate on purchases of 1.3% APR through Feb. 28, 2014 and a special balance transfer rate at 6.9% APR for life of the transferred balance with no balance transfer fees.