NEW ORLEANS-At CUNA Lending Council's 2011 Annual Conference here, Credit Union Journal asked attendees, "What's working with loans?"
Melisa Hunt, manager of financial services,
Mid America CU, Wichita, Kan.
We have to look at every member as an individual and sometimes step outside the box of normal lending practices, because most now are challenged borrowers. We have to sometimes go outside our guidelines. Now is the time to loosen up lending. It's working for us because loan growth is 20%. We are doing really well with indirect auto and signature loans.
Spencer Scarboro, SVP loan origination
State Employees CU, Raleigh, N.C.
We are continuing to originate portfolio mortgages. Our main product is two-year arm, a 2-2, adjustable, no PMI, up to 100% financing. That is about the only thing we found that can compete with the fixed rates in the secondary market now. Portfolioing mortgages is a bit risky now, but we have to because we have so much liquidity. We need to keep those mortgages on our books. Loan growth this year is holding its own, up about 5%.
Mary Conrad, EVP consumer lending
CEFCU, Peoria, Ill.
What's working for CEFCU is our auto loan recapture program. We kicked that off in June and have done a really good job of marketing that to our membership. We are saving members on average $750 in finance charges. Our competitors in the indirect market are offering around 1.85% and we are at 2.39%. We have been as low as 2.19%, and I think we will have to go below 2% to stay competitive. Loan growth overall has been flat. As soon as we make a loan someone pays us back.
Jeff Vint, AVP credit administration
Arkansas FCU, Jacksonville, Ark.
We are running an auto loan refi special that's working. We are going after loans dealers have made to our members through Chase, Toyota, and Ally, primarily. We are having good success bringing those member auto loans back. We started this a few months ago and now we are doing about $4 million a month. Loan growth will be 4% to 5% this year. We do not have to go below 2%, and are as low as 2.99% for the best credit; 4% to 5% is the average loan going out.
Tim Kosak, manager of consumer lending
Consumers CU, Oshtemo, Mich.
There is a lot of market share available through indirect auto, which is growing for us at 20%. So we have increased our dealer reserve, increased our flats, and also started talking with more dealers to build more relationships. Direct auto loan growth has been about 19%. Credit cards have also performed very well-we are looking at 17% to 18% growth there.
