Subsidized Mortgages Offered CUMembers
WASHINGTON - (11/01/05) -- CUNA announced Monday that more than60 credit unions across the country have joined up to offersubsidized low-interest loans to low- and moderate-incomehomebuyers under its new program, dubbed Home Loan PaymentRelief--pronounced 'helper.' Under the program, participatingcredit unions will provide 3-in-1 ARMs at 100 basis point (1%)discounts to borrowers with household incomes at or below themedian area incomes. The increase on the ARM rates, currentlyfour-and five-eighths, will be capped at 1% a year after the thirdyear and 5% for the life of the loan, unless it is refinanced. Thecredit unions have also agreed to lend up to 97% of the loan. "Ourobjective was to find a way to serve people of modest means,especially in this critical area of housing," said Rudy Hanley,president of $5 billion Orange County Teacher's FCU, who helpeddesign the program. Hanley, who has committed 1% of his creditunion's assets to the loans, said he plans to hold them inportfolio. CUNA President Dan Mica, who launched the program, saidthey hope to reach as many as 10 million homebuyers over the nextfive years. "This is the biggest single program we have ever puttogether to aid credit union members," said Mica.