LENEXA, Kan. – Both U.S. Central FCU and WesCorp FCU said they have temporarily shuttered popular loan programs in recent weeks, putting increasing pressure on the secondary market for credit union loans.
WesCorp reported Friday it has not made any loan participation deals in the last two months as it sits on $250 million of demand for member business loan and $25 million of A-Tier auto loans. Many credit unions continue to contact WesCorp for loan participation opportunities, the corporate reported.
The loan participations will "remain on hold" as WesCorp’s board reviews whether to restart the program.
Earlier, U.S. Central FCU, struggling to control costs, said it ceased buying jumbo loans under its Charlie Mac program. The troubled corporate, taken under conservatorship by NCUA on March 20, said it will continue to service both jumbo mortgage and auto loans acquired through the program, which reported a $1 million loss as recently as March, the last time U.S. Central disclosed financials on the program.
In addition, because Charlie Mac has been unable to secure a replacement vendor for the CU Student H.E.L.P. student loan program, it will not pursue further options for continuing this program.
U.S. Central started Charlie Mac in 1998 as a secondary market outlet for credit unions to sell their jumbo loans and keep them within the credit union movement. Since then, U.S. Central purchased more than $1.8 billion of mortgage and auto loans through the program.
