NCUA Seeks Deal on Florida Land Mess

FORT MYERS, Fla. – NCUA is in high-level negotiations to resolve some of the growing liability on Florida real estate loans it inherited from three failed credit unions, according to sources familiar with the talks. Representatives from NCUA currently are in talks with the builder of the Florida homes, which partnered with the three credit unions and other parties over tens of millions of dollars in claims in two local real estate developments, Cape Coral and Lehigh Acres. The two sides are scheduled to meet next Friday to negotiate some kind of settlement of claims. No resolution of the claims is guaranteed, the sources emphasize. The three credit unions, two in Colorado and one in Michigan, financed thousands of loans for new homes in the two developments that were meant to be “flipped” after a year at a guaranteed 14% return for investors. Thousands of the loans have gone into default, leaving NCUA, as conservator of the three failed credit unions, holding as much as $500 million in loans in the two projects. An untold number of credit unions, at least two dozen, also hold millions of dollars in loan participations in the two projects. NCUA is hoping to stave off investors and angry credit unions in court if it can negotiate a settlement of claims.