Wed, Oct 9, 2013
The Mortgage Bankers Association reported today that applications for home loans rose last week for the third time in four weeks. The industry group's market composite index increased by 1.3% compared to the previous seven-day period. However at the present level, it's off its May high by 51%.
The shift in the rate environment and the slowly improving economy and real estate market are creating a movement toward more purchase application. Applications to refinance existing mortgages have been the hardest-hit by the hike in rates. Five weeks ago, the MBA's refinance index dropped by a precipitous 20%, the biggest single-week decline of 2013.
Why is mortgage lending so important? First of all because of the interest income that can be generated, and secondly because holding a member’s mortgage helps to solidify your position as the member’s primary financial institution. Additionally, by not letting a bank service the loan you keep them from chipping away at the member’s loyalty towards your credit union.
CUMA (Credit Union Mortgage Association) a strategic partner for our MD|DC Credit Union Association helps credit unions by handling ALL aspects of the first mortgage. The burden of staffing and staying current with compliance is handled expertly by CUMA. Additionally, CUMA provides economies of scale that for other credit unions would simply not be possible or cost effective. If you have been selling ARM’s but would like to offer fixed rate mortgages CUMA has them. Reverse mortgages? CUMA has them. Jumbo non-conforming, second homes, investment properties? You guessed it CUMA has them.
In talking to Scott Toler, President and CEO of CUMA what reverberates is his and CUMA’s commitment to the credit union movement. This is evident by the fact that CUMA is owned 100% by credit unions and returned $7,000,000 in fee and servicing income to the participating credit unions.
No matter how much of the process you want to control CUMA can come in and fill the gap. Scott believes that CUMA’s value proposition exists in the way they continue to represent your brand in the marketplace to your members providing great service and great pricing. All of this to the benefit of the credit unions and their members.
I asked Scott the question “What do you want your legacy at CUMA to be?” Scott replied, “Every decision we made was for the benefit of the member and their credit union, not some anonymous stockholder or institutional investment company.”
For more information about how CUMA can help make mortgages a successful part of your P/L and your product suite please contact me at firstname.lastname@example.org