AUGUSTA, Maine-Far removed from the so-called "sand states," Maine has its own share of economic challenges.
But credit unions here indicated they are seeing strong opportunities to grow their share of the mortgage market, and one mortgage lending expert agrees: providing lessons are learned from the current crisis.
Ira Oskowsky, regional sales director-Eastern sales division with CMG Mortgage Insurance, polled an audience at the Maine Credit Union League's annual meeting here and found most optimistic about increasing home loan volume.
"Things are really tense right now, but things are going to get better," Oskowsky predicted, before adding the caveat, "It is extremely important we be the first group that doesn't forget. We want to remember the past but be progressive going forward. We have to remember our members need us more than ever. A lot of mortgage lenders have closed and a lot of banks don't want to deal with the average person. Where else are credit union members going to turn? They are relying on you."
Oskowsky, who said credit unions are not in the mortgage business but in the business of advising, reported some CUs in the Northeast are seeing a tripling and quadrupling of volume. One Maine CU said its applications are up 200% over one year ago. He said he believes the traditional CU mortgage share of 2% has been more than doubled to 5% today, and "10% is easily within our sights."
Other market scenario traditions are also being shattered. Oskowsky noted that markets are usually comprised of one of two scenarios: high volume and property values continue to decrease, and high volume and property values stabilize. The former has always meant a refinance boom, the latter a purchase boom. "Right now we have stabilization of property values, but we do not have a purchase market," said Oskowsky. "We are seeing the first alternative, the refinance boom."
While many other lenders have exited the market, Oskowsky urged CUs not to wait for "the business to come in."
"We have enormous ability to produce. We don't know if we have the ability to hold them all in portfolio or to send them to Fannie or Freddie or to find other secondary market alternatives, but we do know we could substantially increase the business we have," Oskowsky said, emphasizing that members' needs should always come first.
