What is TrueConnect™?
It is a small dollar loan program available only as an employee benefit. The standard loans offered are $1000, $1500, $2000, $2500, and $3000. The loan is repaid with small payroll deductions spread out over twelve months. For example*, an employee who borrows a $1,000 TrueConnect loan that is paid 24 times a year (twice a month) would pay approximately $47.58 per paycheck to repay the loan. On average, this is approximately $11.82 a month in finance charges. A similar payday loan might end up costing $300 per month in fees before being fully paid off. TrueConnect is a far less expensive option to borrow short-term credit vs. high-cost payday loans.
What is it intended to do?
Employees often have immediate cash needs to pay for unexpected health care deductibles, car repairs, or other crises. TrueConnect is intended to meet those needs, safely and conveniently. Unlike costly payday loans (often at 400% APR interest or more), the TrueConnect loan is repaid over 12 months* and is much less expensive. It is also an alternative to hardship withdrawals from 401(k) or 403(b) plans, which can dangerously reduce retirement savings.
What makes it safer and better than other alternatives?
Payday loans are very expensive, have to be repaid in full from your next paycheck, and often require leaving the office to take or repay a loan. Credit or debit overdrafts are also expensive and can damage your long-term credit. And 401(k)/403(b) withdrawals can harm your retirement savings goals. In contrast, the TrueConnect loan is offered as an employee benefit, can be conveniently accessed online, and has payments deducted from your paycheck.
How does it work?
When you request The TrueConnect loan, we electronically confirm your eligibility based on information you and your employer provide. If you meet the bank’s eligibility requirements, you choose your loan amount, sign your documents, and instruct the bank where to deposit your money – all online. Depending on the day (and time) of your acceptance, the money will be available the next business day. Your loan will be repaid from your authorized payroll deductions, in accordance with the payment schedule set forth in the loan agreement, beginning on your scheduled payday. You may repay the loan early without penalty if you wish.
Am I eligible?
Your eligibility for the loan program will be automatically assessed once you apply.
Is the loan from my employer?
No. TrueConnect is offered by Sunrise Banks, N.A. of Saint Paul, MN which is an FDIC insured bank. Your employer is making this program available as a voluntary benefit and your employer does not provide any funding or approval for the loan.
Is it private?
Yes. You apply online, so you don’t have to worry about being seen at the payday loan store.
How do I make the loan payments?
Your regular loan payments will be made through payroll deductions. You authorize the payroll deductions through your employer through an Irrevocable Authorization and Direction.
What happens if I leave my employer?
While your employer facilitates repayment through convenient payroll deductions, you are ultimately responsible for repaying your loan after you leave.
What if I am still an employee, but go on leave and no longer have a regular paycheck?
If for any reason, including your being on leave, any two consecutive payments are not made in full, then the payroll deductions will stop. We will then initiate an ACH debit of the unpaid loan amounts, as we are authorized to do under the loan agreement. You may revoke the ACH authorization, but if you do so, it is your responsibility to contact us to establish a special payment method. You can arrange a special payment by calling toll-free at 1-866-827-3520.
What if my employment is terminated or I terminate the automatic payroll deduction before the loan is paid off?
If there remains an unpaid balance, these events are considered defaults. You can avoid default by creating special repayment provisions with Sunrise Banks. The full details regarding default are in the Loan Agreement and Promissory Note – which will be provided to you and which you will have to read and electronically sign in order to receive a TrueConnect loan.
Where can I learn more about my rights and obligations in connection with a TrueConnect loan?
The TrueConnect Loan Agreement and Promissory Note will include full details regarding your loan, including the required Federal Truth-in-Lending Act disclosures. You will also be provided with the Irrevocable Authorization and Direction with respect to your scheduled payroll deductions. These documents are provided to you prior to the time any loan is made, and you must read and agree to the terms before any loan will be made.
I have a TrueConnect loan but have been called to active military duty. What do I need to do?
Under the Service Members Civil Relief Act (SCRA), individuals called to active military duty have rights related to credit obtained prior to entering active duty. Contact the bank using the contact information provided on your loan documents.
*Loan Example – Finance Charge Calculation – for example – for a $1,000 loan, an employee paid 24 times over a 12 month period would have approximately $47.58 deducted from each paycheck. This results in approximately $141.92 in finance charges over twelve months with an Annual Percentage Rate of 24.92%. The Number of payments, payment amounts, total finance charges, and Annual Percentage Rate will vary based on loan amount, payroll repayment periods, and the number of days the loan is outstanding prior to the first payment date.