SACRAMENTO, Calif. — The Golden 1 Credit Union just recently decided to take advantage of the upswing of demand and became a FHA lender in early August. "In May, over 40% of all homes purchased in the Sacramento County area were FHA financed," noted CFO Donna Bland.
"It allows members to buy a home with little money out of pocket and that's a challenge these days," added SVP-Lending Curtis Dair.
The federal government guarantees every FHA and VA loan, but there is still some inherent risk. CUs that fail to abide by specific origination, delinquency reporting and other rules, such as aggressive measures to care for properties as they head into foreclosure, will not be paid back.
"A lot of lenders don't think about that because they are primarily focused on making sure they get that FHA insurance up front," Dair said. "You have to be able to service those loans in accordance to FHA guidelines or else you can lose that insurance."
Golden 1 CU makes sure its reimbursements are assured by outsourcing the servicing on those loans to a third party vendor.
