Is your credit union seeing any fallout from the problems in the subprime mortgage market, and what are your expectations for your credit union in the fourth quarter?
We are seeing opportunities in mortgages, especially in the jumbo loans because everybody has been scared away. If your underwriting standards are good, those are good mortgages. Some people are running into resistance with other lenders because those lenders' involvement in subprime mortgages has hurt their liquidity. We are in great shape. We have just completed a series of mergers, including one with New Horizons in Denver. We have other mergers in the works that will give us a presence in South Texas. We are working with the Archdiocese of Corpus Christi, plus another credit union in Harlingen. These mergers should be completed in the fourth quarter.
In our area, we have not seen any mortgage problems. Construction has slowed down from last year, but it is still better than it was five years ago. We are still doing lots of mortgages. We had a great third quarter, and we expect sustained loan demand and above-average deposits in the fourth quarter. We don't see a slowdown at all.
No problems, but we just started mortgage lending. We are part of a mortgage CUSO. As we build the CUSO, we are expecting to see more mortgage loans.
I hope we see more loans in the fourth quarter, because we've really been struggling in that area. Car sales are down in the Houston area, so we've been struggling for market share. However, car sales are beginning to pick up in the third quarter. We will be looking to get our share of car loans in the fourth quarter.
I do see some increase in delinquencies. As people prioritize, they are going to pay for their homes first, vehicles second and unsecured loans third. Gasoline prices are affecting unsecured loans-those people who might have been current are 30 to 60 days behind, missing payments.
In the fourth quarter, the traditional products for credit unions, such as auto and signature loans, will be flat or decline. Some credit unions will get into real estate and commercial loans, which have not been a traditional credit union market, but credit unions will be looking to diversify. CUSOs will be important as strategic relationship builders. CUSOs allow credit unions to merge their resources and do things they can't afford to do by themselves.
