CUNA Mutual Mortgage Corp. has entered the subprime mortgage market, one of the fastest growing segments of the market.
The company's initial offering through credit unions will be 30-year, fixed-rate loans for "caution" loans scoring 1, 2, or 3 on automated underwriting systems. CUNA Mutual Mortgage will underwrite, close and service the loans for its credit union customers.
The company has been preparing its credit union customers for the program through a series of webinars the last two months, in which representatives from 151 credit unions participated.
"Subprime is a wonderful opportunity for credit unions to tap into a market they previously may have been reluctant to enter," said Tom Pisapia, VP-secondary marketing with CUNA Mutual.
CUNA Mutual noted that subprime mortgage lending has seen 25% annual growth over the past 10 years, hitting $332 billion during 2003.
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