Lending

ALBUQUERQUE, N.M. – New Mexico Educators FCU has signed with Fynanz to offer the company’s customized private student loans.

MADISON, Wis. – Lending at credit unions declined again in January, by 0.7%, falling for the fourth straight month, as consumers continue efforts to shed debt, according to CUNA.

LAKE JACKSON, Texas – Dow Chemical Employees CU has signed with Fynanz to offer the company’s private student loans through its cuStudentLoans program.

WASHINGTON – The Obama administration is planning the wind down of Fannie Mae and Freddie Mac and will begin the process of encouraging more private sector involvement in the secondary mortgage market, a top administration official said yesterday during CUNA’s Government Affairs Conference.

RALEIGH, N.C. – State Employees’ CU is cutting interest rates on its Salary Advance Loan by as much as 50%.

SYRACUSE, N.Y. – Cooperative FCU will leverage a $25,000 grants from the Central New York Community Foundation to make $100,000 available for small business loans up to $20,000. The program will be overseen by the Near West Side Initiative. To be eligible for a loan, business owners must enroll in the initiative’s small business program and be a member of the area’s newly formed business association. The program offers free one-on-one classes in marketing, financial strategies, and basic market research, among other topics. SYRACUSE, N.Y. – Cooperative FCU will leverage a $25,000 grants from the Central New York Community Foundation to make $100,000 available for small business loans up to $20,000.

SAN JOSE, Calif. — At a time when many lenders are scaling back mortgage operations, Technology Credit Union has raised the limit on its jumbo mortgage loan to $3 million.

LA HABRA, Calif. — American First CU has offered select members in good standing an opportunity to dodge a potential financial bullet.

FRESNO, Calif. – Fresno FCUis now offering private student loans through MyCU College Loans. The MyCU loan offers lower rates, zero origination or startup fees and flexible repayment terms, officials say. FRESNO, Calif. – Fresno FCUis now offering private student loans through MyCU College Loans.

WASHINGTON – Secondary mortgage market giant Freddie Mac reported another $1.7 billion loss for the fourth quarter of 2010, creating a $19.8 billion loss for the year. The report, which comes with a request for another $500 million in government assistance, comes as Congress is opening its inquiry on the future of Freddie and its secondary market sister Fannie Mae. The government rescued Freddie and Fannie in September 2008 to cover their losses on soured mortgage loans. It estimates the bailouts will cost taxpayers as much as $259 billion. Fannie Mae and Freddie Mac own or guarantee about half of all mortgages in the U.S., or nearly 31 million home loans worth more than $5 trillion. Along with other federal agencies, they played some part in almost 90 percent of new mortgages over the past year. Georgia’s Own CU Opts For Fiserv’s Acumen ATLANTA – Georgia’s Own CU signed with Fiserv to install the company’s account-processing, online banking and other software products, a new client for Fiserv. The $1.6 billion credit union will install Fiserv’s Acumen data processing system, as well as ZashPay, a person-to-person payment service; the Corillian online-banking technology; CheckFree electronic bill payments; and Mobile Money mobile banking. The value of the contract was not disclosed.WASHINGTON – Secondary mortgage market giant Freddie Mac reported another $1.7 billion loss for the fourth quarter of 2010, creating a $19.8 billion loss for the year.

WASHINGTON – Mortgage rates declined for the third week in a row, with the average for the benchmark 30-year loan dipping back below 5%, according to Freddie Mac. The average for the benchmark rate, which has see-sawed for the past six months, was 5.05% last week. The average for the 15-year mortgage dipped to 4.22%, from 4.27% last week. ARM rates were mixed, with the average for the five-year ARM falling to 3.80%, from 3.87%; and the average for the one-year ARM inching up to 3.40%, from 3.39% last week. “Fixed mortgage rates eased again this holiday week amid mixed inflation data reports,” said Frank Nothaft, chief economist for Freddie Mac. “Although the core consumer price index for January rose slightly above the market consensus, house prices fell 4.1% in the fourth quarter of 2010 compared to the same period in 2009. In addition, the level of the index was the lowest since the fourth quarter of 2002.”WASHINGTON – Mortgage rates declined for the third week in a row, with the average for the benchmark 30-year loan dipping back below 5%, according to Freddie Mac.

WASHINGTON – The Republican leadership of the House Financial Services Committee plans to introduce four bills next week that would terminate the Obama administration’s mortgage foreclosure programs they labeled “failed” and “ineffective.” The bills to be voted by the new Republican-controlled committee next week would eliminate the Neighborhood Stabilization Program, the FHA Refinance Program, the Emergency Homeowner Relief Fund, and the Home Affordable Modification Program, known as HAMP, which has provided grants to dozens of credit unions to intervene in foreclosures. “In an era of record-breaking deficits, it’s time to pull the plug on these programs that are actually doing more harm than good for struggling homeowners,” said Rep. Spencer Bachus of Alabama, the new chairman of financial services. “These programs may have been well-intentioned but they’re not working and, in reality, are making things worse.” According to the Republican leadership on the committee the HAMP was supposed to help 4 million homeowners, but only 521,630 loans have been permanently modified under the program, and the re-default rate is high. The government has spent about $840 million on HAMP, the leadership said. Chances of the programs being eliminated with these bills are slim because they would still have to be approved by the Democratically controlled Senate, which is not likely to agree. WASHINGTON – The Republican leadership of the House Financial Services Committee plans to introduce four bills next week that would terminate the Obama administration’s mortgage foreclosure programs they labeled “failed” and “ineffective.”

NEWARK, N.J. – The FBI investigation into a massive fraud at U.S. Mortgage Corp. and its CU National subsidiary conducted by Michael McGrath its president was initially uncovered by one of McGrath’s business partners, who was negotiating his own plea in a separate mortgage fraud. Gerald Carti, a former loan officer and shareholder of U.S. Mortgage, eventually agreed to plead guilty to a multi-million dollar loan flipping scheme, according to prosecutors in both cases. As part of the scheme, Carti and his co-conspirators purchased cheap two- and three-family rental homes in distressed neighborhoods of Patterson, N.J., and then flipped them at grossly inflated prices to unqualified buyers whose loan applications were doctored with bogus incomes, bank account balances and assets. Carti, 63, earned $1 million a year as one of U.S. Mortgage’s most successful loan originators, but much of that success was due to his willingness to commit fraud, according to prosecutors. Investigators sought Carti’s cooperation in 2005, before anyone was charged, but “he thought he could beat this” and refused to cut a deal, according to court records in the case. Carti also encouraged his sons to help investigators unravel a massive $140 million scheme involving the fraudulent sale of loans to Fannie Mae that resulted in a 2009 guilty plea McGrath, the former U.S. Mortgage president who was sentenced yesterday to 14 years in prison. A third U.S. Mortgage officer, Frank Corallo pleaded guilty in a separate case to a scheme to originate subprime mortgage loans during 2004 while working as a loan officer and processor at U.S. Mortgage Corp. At the direction of his superiors at U.S. Mortgage, Corallo helped pay off several mortgage loans that U.S. Mortgage had originated fraudulently. Corallo brokered new, fraudulent subprime loans to pay off the old loans and provide additional money to other participants in the scheme. It is not clear if Corallo also helped the FBI with the McGrath case. To date, only one other U.S. Mortgage employee, Leroy Hayden, a servicing manager, has been convicted in the CU National fraud. The cases were unwound by a special mortgage crimes task force created by the Justice Department which was coordinated by the FBI, the U.S. Postal Service, the Department of Housing and Urban Development and the IRS. NEWARK, N.J. – The FBI investigation into a massive fraud at U.S. Mortgage Corp. and its CU National subsidiary conducted by Michael McGrath its president was initially uncovered by one of McGrath’s business partners, who was negotiating his own plea in a separate mortgage fraud.

NEWARK, N.J. – Michael McGrath, the president of U.S. Mortgage Corp. and its CU National Mortgage unit, was sentenced this afternoon to 14 behind bars for a massive fraud in which he sold $140 million of credit union mortgages his company was servicing to Fannie Mae and kept the proceeds. The fraud has had broad affects on its 28 credit union victims because McGrath gambled away all of the proceeds in the falling stock market, leaving an estimated $125 million of losses for those institutions, which have been fighting Fannie Mae and their insurers for recompense for the past two years. Four credit unions have filed suit against Fannie Mae for the return of their mortgages. They are: Suffolk FCU in New York, which claims it is owed $32 million in mortgages; Picatinny FCU in New Jersey $14 million; Sperry Associates FCU and TCT FCU, also in New York have also filed suit against Fannie Mae. U.S. Treasury Department FCU in Washington has a $15 million claim in with Fannie Mae but is not part to any of the suits. McGrath told prosecutors he used the proceeds from the fraud to keep his faltering Pine Brook, N.J., mortgage company afloat, even buying one million shares of Fannie Mae as the mortgage giant’s stock disintegrated prior to its September 2009 takeover by the federal government. U.S. Mortgage filed for bankruptcy in February 2009 was liquidated over the succeeding months. McGrath, 48, pled guilty to one count of mail and wire fraud conspiracy, and one count of money laundering conspiracy. Despite evidence that McGrath had help in carrying out the fraud, only one other figure has been charged in the scheme, Leroy Hayden, who was the servicing manager for the mortgage company. Hayden pleaded guilty last year to charges of conspiracy in the case. McGrath admitted that between January 2004 and January 2009, he conspired with several others to fraudulently sell loans belonging to the credit unions and used the proceeds to fund U.S. Mortgage’s operations and his personal investments and investments he made on U.S. Mortgage’s behalf. The scheme started with the diversion of funds that should have been paid to various credit unions for mortgage loans they had made and authorized CU National to sell to Fannie Mae. McGrath began withholding these funds to help U.S. Mortgage address cash flow problems caused by losing investments in mortgage-backed securities he had made on the company’s behalf. The sell the loans, McGrath forged documents–so-called allonges--assigning the loans from the credit unions to U.S. Mortgage in which he pretended to be an officer of the credit unions in question. He also directed employees at U.S. Mortgage to execute documents purporting to assign the loans from U.S. Mortgage to Fannie Mae. And he sold some of these loans a second time, to an institution based in New Jersey. All told, the scheme netted about $139 million. McGrath was also sentenced to three years of supervised release and restitution will be determined at a later date.

WASHINGTON – Long-term mortgage rates moved lower this week, after rising the past four weeks, according to Freddie Mac.

FAIRFAX, Va. – Fairfax County FCU is now offering members a HarmonyLoan which adjusts its interest rate at the member’s call.

DOVER, Del. – Dover FCU has contracted for business lending services with CU Business Group, a Portland, Ore., CUSO.

WASHINGTON – Private markets and not government sponsored enterprises Fannie Mae and Freddie Mac would be the primary source of mortgage credit going forward under the Obama Administration's plan to reform the housing finance system, announced this morning during a briefing at the Treasury Department.