Cost Advantages Spur CU MortgageLending
WASHINGTON - (09/29/04) -- Credit unions may be at adisadvantage to other mortgage lenders when it comes to experienceor convenience, but not when it comes to cost controls. DanielMudd, chief operating office for Fannie Mae, said average creditunions costs for closing a mortgage loan are almost half that ofall other lenders, $883 compared for credit unions, compared to$1,689 for other lenders. And some credit unions are able to closemortgages for as little as $354, Mudd said during remarks toNAFCU's Congressional Caucus. Mudd said the secondary mortgagemarket giant has been growing its business and the mortgagebusiness for credit unions through its two-year-old alliance withNAFCU. The alliance has helped facilitate lending, as well as newinnovations, such as a 40-year mortgage, which was developedthrough Fannie's CU Advisory Council, and is being adopted bygrowing numbers of credit unions. Fannie, said Mudd, has alsoextended its partnership for its online mortgage underwriting toolwith credit union mortgage lender Prime Alliance through 2011.Prime Alliance, a Tukwila, Wash., CUSO, does business with as manyas 600 credit unions. Mudd also said the company will work closelywith federal regulators to implement provisions of a supervisoryagreement over accounting improprieties that will, among otherthings, require the company to boost its capital by 30% over thenext nine months.