The plunge in interest rates over the past five years has helped transform credit unions to the point that mortgage lending has become their main focus.
Data compiled by CUNA shows that mortgage loans comprised 42.6% of total loan portfolios in June, up from just 33.8% five years ago, and exceeding the traditional mainstay of auto loans, which comprised 39% of loans at mid-year. Credit unions had $145.2 billion of mortgage loans on their books and $132.9 billion of car loans at mid-year. During the past five years credit unions have grown their mortgage portfolios by 78%, adding $63.2 billion in new mortgage- related loans. Over the same time, the portion of the portfolio devoted to car loans fell slightly, from 40.3% to 39%. Unsecured lending has seen the greatest decline among credit union priorities, falling from 18.5% of all loans in 1997 to just 12.5% at mid-year 2002.