DURHAM, N.C. - The safest and smartest choice for credit unions looking to finance mortgages right now? Begin with your own members.
That was just one piece of advice given to CU professionals who spent two days learning how to safely expand their mortgage lending programs despite the current economic climate as part of a workshop titled “Mortgage Lending Strategies in Uncertain Times.” The meeting was organized by the National Federation of Community Development Credit Unions.
Participants heard from a number of mortgage lending experts, including Martin Eakes, CEO of Self Help CU in Durham, N.C., Bob Dorsa, CEO of the American Credit Union Mortgage Association (ACUMA), Phil Greer, VP at State Employees’ Credit Union in Raleigh, N.C., and NCUA Vice Chairman Rodney Hood. Other session topics during the workshop included housing counseling, loan servicing and underwriting, and secondary markets.
Eakes emphasized the need to make mortgage loans by starting with existing members. “There is simply is no other choice; credit unions have to make more mortgage loans” in order to survive financially and to fulfill the credit union mission,” said Eakes, who in the 1980s founded Self-Help CU, which has provided low-income members more than $5 billion in affordable financing through direct lending and through its own affordable loan secondary market.
SECU’s Greer told attendees the most important thing is to do the “right thing.” SECU has a number of innovative and affordable loan programs, including one that provides low-interest loans to teachers relocating to North Carolina, and another that promotes environmentally sustainable “green” construction.
The meeting also featured a special practitioner workshop on foreclosure prevention, led by Rita L. Haynes, CEO of Faith Community United CU in Cleveland, and Gloria McClendon, branch manager and loan officer at the same $10-million CDCU. Cleveland is a city that has seen some of the highest foreclosure rates in the United States, and Faith Community United CU is doing all it can to help its low-income members, Haynes said.
McClendon encouraged credit unions to be creative in pioneering new products to help members with their mortgages, even if indirectly. The “Wheels Loan” program at Faith Community United CU, for example, has helped many CDCU members refinance their car payments, allowing them to free-up additional cash for mortgage payments, thereby preventing foreclosures. “By being creative with their lending products CDCUs can make a real difference in their members’ lives,” McClendon explained.
ACUMA’s Dorsa focused on the future of the mortgage markets and explained that mortgages are essential to the success of the credit union movement. “Helping people affected by this mortgage crisis may be one of the greatest opportunities for credit unions as a movement,” he said, emphasizing that now was the time for these institutions to show the credit union difference.
