S&P Global Market Intelligence is reporting that mortgage originations at credit unions was up almost 30 percent in 2019.
According to Home Mortgage Disclosure Data, credit union originated $177.3 billion in home mortgages in 2019. This was up from approximately $137 billion in 2018.
However, credit union market share of mortgages slipped from 6.9 percent in 2018 to 6.7 percent in 2019.
Navy Federal Credit Union (Vienna, VA) was the top credit union mortgage originator in 2019 funding $19.78 billion in mortgages. This was up 20.3 percent from the prior year. Navy FCU is the 19th largest mortgage lender in 2019.
Read more.
Showing posts with label Mortgages. Show all posts
Showing posts with label Mortgages. Show all posts
Wednesday, July 29, 2020
Tuesday, April 7, 2020
Regulators Encourage Mortgage Servicers to Work with Homeowners Affected by COVID-19
Financial regulators on April 3 issued a joint policy statement granting flexibility to mortgage servicers to work with borrowers struggling as a result of the coronavirus pandemic. Under the CARES Act, servicers are required to grant payment forbearances to impacted borrowers for up to 180 days, and possibly longer.
The agencies confirmed that these forbearance offers are exempt from certain loss mitigation procedural requirements and servicers do not need to obtain a complete application before offering CARES Act forbearance to a borrower. The agencies also said that they would not penalize servicers for failing to provide the required notice of acknowledgement to borrowers who submit incomplete applications within the five-day timeframe described in the servicing rules, provided that the notice is given before the end of the forbearance period. The agencies also said that they would not penalize servicers for failing to provide other loss mitigation notices and outreach efforts, so long as servicers demonstrate good-faith efforts to comply “within a reasonable timeframe.”
Finally, the agencies said they would not take action against servicers for delays in sending annual escrow statements, provided the servicers demonstrate good-faith efforts to comply “within a reasonable timeframe.” In addition to the statement, the CFPB offered further clarification in a set of frequently asked questions regarding compliance with the servicing rules during the COVID-19 emergency
Read more.
The agencies confirmed that these forbearance offers are exempt from certain loss mitigation procedural requirements and servicers do not need to obtain a complete application before offering CARES Act forbearance to a borrower. The agencies also said that they would not penalize servicers for failing to provide the required notice of acknowledgement to borrowers who submit incomplete applications within the five-day timeframe described in the servicing rules, provided that the notice is given before the end of the forbearance period. The agencies also said that they would not penalize servicers for failing to provide other loss mitigation notices and outreach efforts, so long as servicers demonstrate good-faith efforts to comply “within a reasonable timeframe.”
Finally, the agencies said they would not take action against servicers for delays in sending annual escrow statements, provided the servicers demonstrate good-faith efforts to comply “within a reasonable timeframe.” In addition to the statement, the CFPB offered further clarification in a set of frequently asked questions regarding compliance with the servicing rules during the COVID-19 emergency
Read more.
Wednesday, September 11, 2019
Groups Call for Changes to QM Framework Ahead of GSE Patch Expiration
A broad coalition of financial industry stakeholders, civil rights groups and other advocacy organizations wrote the Consumer Financial Protection Bureau (CFPB) on September 9 offering feedback on the expiration of the temporary “GSE patch,” which grants Qualified Mortgage (QM) status to loans eligible to be purchased or guaranteed by Fannie Mae or Freddie Mac.
The letter was sent in response to an advanced notice of proposed rulemaking by the CFPB.
With the CFPB poised to allow the GSE patch to expire as scheduled in January 2021, “or after a short extension,” the groups proposed several changes to the QM framework. The groups called on the CFPB to eliminate from the general QM category the debt-to-income ratio and the associated Appendix Q. They noted that doing so is “the best way to enable fair market competition across all lending channels while also ensuring that these creditworthy individuals can be served in a safe and sound manner under the existing ATR-QM framework.”
The groups also called on the bureau to maintain and enhance the existing Ability-to-Repay Rule’s regulatory language and maintain the existing QM statutory safe product restrictions that prohibit certain risky loan features—such as loan terms over 30 years, negative amortization or interest-only payments—and clarify provisions related to documentation and verification of income.
Both the American Bankers Association and the Credit Union National Association signed the letter.
Read the letter.
The letter was sent in response to an advanced notice of proposed rulemaking by the CFPB.
With the CFPB poised to allow the GSE patch to expire as scheduled in January 2021, “or after a short extension,” the groups proposed several changes to the QM framework. The groups called on the CFPB to eliminate from the general QM category the debt-to-income ratio and the associated Appendix Q. They noted that doing so is “the best way to enable fair market competition across all lending channels while also ensuring that these creditworthy individuals can be served in a safe and sound manner under the existing ATR-QM framework.”
The groups also called on the bureau to maintain and enhance the existing Ability-to-Repay Rule’s regulatory language and maintain the existing QM statutory safe product restrictions that prohibit certain risky loan features—such as loan terms over 30 years, negative amortization or interest-only payments—and clarify provisions related to documentation and verification of income.
Both the American Bankers Association and the Credit Union National Association signed the letter.
Read the letter.
Monday, January 28, 2019
Does Primary Financial Institution Impact Consumers' Choice of Mortgage Providers?
Raddon Research Insights found that consumers, who identify a credit union as their primary financial institution, are more likely to go to their credit union for a mortgage than individuals identifying other financial institutions as their primary financial institutions.
Eighty-three percent of credit union members, who identify their credit union as their primary financial institution, plan to use their credit union for a mortgage.
Only 32 percent of customers who state a major bank is their primary financial institution would use this major bank for a mortgage.
The percentage of regional bank and community bank customers were under 25 percent.
Eighty-three percent of credit union members, who identify their credit union as their primary financial institution, plan to use their credit union for a mortgage.
Only 32 percent of customers who state a major bank is their primary financial institution would use this major bank for a mortgage.
The percentage of regional bank and community bank customers were under 25 percent.
Friday, October 12, 2018
Community Banks View CUs as Primary Competitor for Consumer Loans
Community banks view credit unions as their primary competitor for consumer loans, according to a survey.
The survey was conducted by the Federal Reserve and the Conference of State Bank Supervisors.
The survey found that 41.3 percent of community banks stated that credit unions are currently their primary competitor for consumer loans. Survey respondents believe credit unions will in the future be their primary competitor for consumer loans (35.6 percent).
With regard to mortgage loans, 13.5 percent of community banks identified credit unions as their current primary competitor. In the future, 13 percent of community banks expect credit unions to be their primary competitor.
Only 5.5 percent of community banks view credit unions as a primary competitor for small business loans. However, the expectations is for competition from credit unions in small business lending to grow as 10.7 percent identified credit unions as their primary future competitors.
Only 3.3 percent of community banks identify credit unions as their primary competitor for commercial real estate loans. In the future, 6.9 percent of community banks believe credit unions will be their primary competitor for commercial real estate loans.
With regard to agricultural loans, banks don't view credit unions as a primary competitor in the present or the future.
Read the survey report.
The survey was conducted by the Federal Reserve and the Conference of State Bank Supervisors.
The survey found that 41.3 percent of community banks stated that credit unions are currently their primary competitor for consumer loans. Survey respondents believe credit unions will in the future be their primary competitor for consumer loans (35.6 percent).
With regard to mortgage loans, 13.5 percent of community banks identified credit unions as their current primary competitor. In the future, 13 percent of community banks expect credit unions to be their primary competitor.
Only 5.5 percent of community banks view credit unions as a primary competitor for small business loans. However, the expectations is for competition from credit unions in small business lending to grow as 10.7 percent identified credit unions as their primary future competitors.
Only 3.3 percent of community banks identify credit unions as their primary competitor for commercial real estate loans. In the future, 6.9 percent of community banks believe credit unions will be their primary competitor for commercial real estate loans.
With regard to agricultural loans, banks don't view credit unions as a primary competitor in the present or the future.
Read the survey report.
Friday, May 25, 2018
CUs Accounted for 9.7 Percent of All Mortgage Originations in 2017
Credit unions accounted for about 9.7 percent of all mortgage originations in 2017, according to Home Mortgage Disclosure (HMDA) data. This is up from 9 percent in 2016.
In 2017, 1,706 credit unions were HMDA reporters.
Out of these 1,706 credit unions, 781 credit unions made fewer than 100 loans and 198 credit unions originated fewer than 25 loans.
Credit unions originated 237 thousand home-purchase loans in 2017 and 209 thousand refinance loans. A home-purchase loan or refinance loan is first lien mortgage for a one-to-four family, owner occupied, site-built homes.
Approximately 85 percent of home-purchase loans originated by credit unions were conventional mortgages, while almost 95 percent of refinance loans originated credit unions were conventional mortgages.
Credit unions are more likely than other lenders to hold mortgage loans they originated in portfolio. Credit unions sold about 44.9 percent of the home-purchase loans they originated and about 32.2 percent of the refinance loans they originated.
Credit unions reported that 4.3 percent of its conventional home-purchase mortgages were higher-priced loans, while 3 percent of its refinance loans were higher-priced loans.
Navy Federal Credit Union was the twelfth largest mortgage originator in 2017 and the only credit union to appear among the top 25 originators. Roughly 38 percent of the home purchase loans were conventional mortgages and approximately 23 percent of these conventional mortgages were higher-priced loans.
Read the report.
In 2017, 1,706 credit unions were HMDA reporters.
Out of these 1,706 credit unions, 781 credit unions made fewer than 100 loans and 198 credit unions originated fewer than 25 loans.
Credit unions originated 237 thousand home-purchase loans in 2017 and 209 thousand refinance loans. A home-purchase loan or refinance loan is first lien mortgage for a one-to-four family, owner occupied, site-built homes.
Approximately 85 percent of home-purchase loans originated by credit unions were conventional mortgages, while almost 95 percent of refinance loans originated credit unions were conventional mortgages.
Credit unions are more likely than other lenders to hold mortgage loans they originated in portfolio. Credit unions sold about 44.9 percent of the home-purchase loans they originated and about 32.2 percent of the refinance loans they originated.
Credit unions reported that 4.3 percent of its conventional home-purchase mortgages were higher-priced loans, while 3 percent of its refinance loans were higher-priced loans.
Navy Federal Credit Union was the twelfth largest mortgage originator in 2017 and the only credit union to appear among the top 25 originators. Roughly 38 percent of the home purchase loans were conventional mortgages and approximately 23 percent of these conventional mortgages were higher-priced loans.
Read the report.
Monday, November 27, 2017
CUs Accounted for 9 Percent of All Mortgage Loans in 2016
Credit unions accounted for 9 percent of all mortgage originations in 2016, according to Home Mortgage Disclosure Act (HMDA) data.
There were 1,939 credit unions that filed HMDA reports. A majority of credit unions (1,025) made fewer than 100 loans and 374 credit unions reported fewer than 25 loans.
Credit unions reported 215 thousand home-purchase loans. Almost 87 percent of home-purchase loans were conventional mortgages.
Credit unions, along with small banks, accounted for a highly disproportionate share of conventional higher-priced loans. Five percent of credit unions' conventional loans were high-priced versus 3.7 percent of all conventional mortgages made by all lenders.
Almost one quarter (25.2 percent) of all home-purchase loans were made to low-and moderate-income (LMI) borrowers and 13.2 percent were to LMI neighborhoods.
Credit unions reported 277 thousand refinance loans, of which 96 percent were conventional loans.
Credit unions sold about one-half of the home-purchase loans they originated and about 40 percent of the refinance loans they originated.
Read the Federal Reserve Bulletin article.
There were 1,939 credit unions that filed HMDA reports. A majority of credit unions (1,025) made fewer than 100 loans and 374 credit unions reported fewer than 25 loans.
Credit unions reported 215 thousand home-purchase loans. Almost 87 percent of home-purchase loans were conventional mortgages.
Credit unions, along with small banks, accounted for a highly disproportionate share of conventional higher-priced loans. Five percent of credit unions' conventional loans were high-priced versus 3.7 percent of all conventional mortgages made by all lenders.
Almost one quarter (25.2 percent) of all home-purchase loans were made to low-and moderate-income (LMI) borrowers and 13.2 percent were to LMI neighborhoods.
Credit unions reported 277 thousand refinance loans, of which 96 percent were conventional loans.
Credit unions sold about one-half of the home-purchase loans they originated and about 40 percent of the refinance loans they originated.
Read the Federal Reserve Bulletin article.
Tuesday, October 24, 2017
Study Finds CUs Gaining Market Share
A recent study by the Federal Reserve Bank of Philadelphia found that credit unions are growing faster than small banks and have gained market share relative to small banks.
The report also noted that small banks and thrifts have lost market share to large banks.
Despite their expansion, credit unions only hold about 7.1 percent of the assets held by all depository institutions.
One of the research questions explored by the study is whether credit unions and small banks compete for the same customers.
The Philly Fed found that small banks and credit unions compete for similar borrowers in the residential lending market.
According to the study, "the mortgages for purchasing one- to four-family homes that credit unions and small banks make are similar across all income tracts."
But the study noted that credit unions may have more stringent real estate lending standards. According to data, "credit unions reject a larger proportion of their home loan applicants, and the difference in rejection rates is greatest in low- and middle-income tracts." In addition, the study found that credit unions had a lower charge-off rate on home mortgage loans.
For example, the following chart looks at rejection rates for mortgages in low-and moderate-income census tracts by credit unions and small banks.
The study also notes that since 1990, credit unions have doubled their market share of consumer loans. However, small banks have only a small share of consumer loan market, losing market share to both large banks and credit unions.
The study states that credit unions tend to offer more flexible terms on their auto loans. "Car buyers who finance their purchases through a credit union generally have lower credit scores, longer loan maturities, and lower monthly payments compared with those who take out a car loan from a small or medium-size bank." The offering more flexible terms on car loans may arise from the ability of credit unions to cross-collateralize these loans with borrowers deposits.
The report argues for more study of the credit union industry, especially as the industry moves from its traditional markets.
Read the study.
The report also noted that small banks and thrifts have lost market share to large banks.
Despite their expansion, credit unions only hold about 7.1 percent of the assets held by all depository institutions.
One of the research questions explored by the study is whether credit unions and small banks compete for the same customers.
The Philly Fed found that small banks and credit unions compete for similar borrowers in the residential lending market.
According to the study, "the mortgages for purchasing one- to four-family homes that credit unions and small banks make are similar across all income tracts."
But the study noted that credit unions may have more stringent real estate lending standards. According to data, "credit unions reject a larger proportion of their home loan applicants, and the difference in rejection rates is greatest in low- and middle-income tracts." In addition, the study found that credit unions had a lower charge-off rate on home mortgage loans.
For example, the following chart looks at rejection rates for mortgages in low-and moderate-income census tracts by credit unions and small banks.
The study states that credit unions tend to offer more flexible terms on their auto loans. "Car buyers who finance their purchases through a credit union generally have lower credit scores, longer loan maturities, and lower monthly payments compared with those who take out a car loan from a small or medium-size bank." The offering more flexible terms on car loans may arise from the ability of credit unions to cross-collateralize these loans with borrowers deposits.
The report argues for more study of the credit union industry, especially as the industry moves from its traditional markets.
Read the study.
Monday, August 28, 2017
CFPB Temporarily Raises HELOC Reporting Threshold, Makes HMDA Technical Corrections
The Consumer Financial Protection Bureau (CFPB) on Thursday issued a final rule making several technical corrections and clarifications to the expanded data collection under Regulation C, which implements the Home Mortgage Disclosure Act, as well as temporarily raising the threshold at which banks and credit unions are required to report data on home equity lines of credit (HELOC).
Under the rule as originally written, banks and credit unions originating more than 100 HELOCs would have been generally required to report under HMDA, but the final rule temporarily raises that threshold to 500 HELOCS for calendar years 2018 and 2019, allowing the bureau time to assess whether to make the adjusted threshold permanent.
The final rule contains a number of clarifications, technical corrections, and minor changes to the HMDA regulation. In finalizing the technical corrections, the CFPB backtracked on a proposal to define multifamily dwellings as including properties in multiple locations. The CFPB also clarified certain key terms, such as “temporary financing” and “automated underwriting system.”
Read the press release.
Under the rule as originally written, banks and credit unions originating more than 100 HELOCs would have been generally required to report under HMDA, but the final rule temporarily raises that threshold to 500 HELOCS for calendar years 2018 and 2019, allowing the bureau time to assess whether to make the adjusted threshold permanent.
The final rule contains a number of clarifications, technical corrections, and minor changes to the HMDA regulation. In finalizing the technical corrections, the CFPB backtracked on a proposal to define multifamily dwellings as including properties in multiple locations. The CFPB also clarified certain key terms, such as “temporary financing” and “automated underwriting system.”
Read the press release.
Friday, May 12, 2017
Wescom Central CU Settles Maternity Discrimination Complaint
The U.S. Department of Housing and Urban Development announced an agreement between Wescom Central Credit Union (Pasadena, CA) and a married couple from Santa Ana, CA, resolving allegations the credit union denied the couple’s mortgage loan application because the wife was on maternity leave.
The couple alleged that Wescom Credit Union unfairly denied their mortgage loan and that the lender requested the woman return to work and provide a current pay stub before they would approve the loan application.
However, refusing to provide a mortgage loan or mortgage insurance because a woman is pregnant or on family leave violates the Fair Housing Act’s prohibition against sex and familial status discrimination, which includes discrimination against individuals who have or are expecting a child.
Under the terms of the agreement, Wescom Central will:
The couple alleged that Wescom Credit Union unfairly denied their mortgage loan and that the lender requested the woman return to work and provide a current pay stub before they would approve the loan application.
However, refusing to provide a mortgage loan or mortgage insurance because a woman is pregnant or on family leave violates the Fair Housing Act’s prohibition against sex and familial status discrimination, which includes discrimination against individuals who have or are expecting a child.
Under the terms of the agreement, Wescom Central will:
- Refinance the couple’s existing mortgage at a lower rate;
- Create a $50,000 compensation fund for applicants who were similarly denied loans or withdrew mortgage applications from Wescom during calendar year 2015;
- Ensure its lending policies regarding parental leave comply with the Fair Housing Act;
- Provide fair lending training to its employees; and
- Send a notice to its employees regarding its parental leave lending policies.
Monday, November 14, 2016
NCUA: No CUs Fined for Mortgage-Related Violations Between January 2012 and April 2016
Last week the Government Accountability Office (GAO) released a report reviewing the collection and use of funds from financial institutions for mortgage-related violations.
According to the GAO, "National Credit Union Administration (NCUA) ... had not assessed any penalties against financial institutions for mortgage-related violations from January 2012 through April 2016."
While NCUA did not assess any monetary penalties against credit unions for mortgage-related violations, this should not be interpreted to mean that credit unions had not had mortgage-related violations. Instead, NCUA may have addressed mortgage-related violations via the supervisory process.
Read the report.
According to the GAO, "National Credit Union Administration (NCUA) ... had not assessed any penalties against financial institutions for mortgage-related violations from January 2012 through April 2016."
While NCUA did not assess any monetary penalties against credit unions for mortgage-related violations, this should not be interpreted to mean that credit unions had not had mortgage-related violations. Instead, NCUA may have addressed mortgage-related violations via the supervisory process.
Read the report.
Friday, November 11, 2016
Evansville Teachers FCU Buys Regional Mortgage Company
CU Today is reporting that Evansville Teachers FCU (Evansville, IN) plans to purchase First Liberty Financial Mortgage, a regional mortgage company headquartered in Owensboro, KY.
With the acquisition, First Liberty Financial Mortgage will become a division of Evansville Teachers FCU.
The $1.3 billion credit union expects this acquisition to double its monthly mortgage production.
The deal is expected to become effective November 15 and will expand the credit union’s mortgage lending presence to 12 new markets in the states of Kentucky, Tennessee, Alabama, and Mississippi.
Read the story.
With the acquisition, First Liberty Financial Mortgage will become a division of Evansville Teachers FCU.
The $1.3 billion credit union expects this acquisition to double its monthly mortgage production.
The deal is expected to become effective November 15 and will expand the credit union’s mortgage lending presence to 12 new markets in the states of Kentucky, Tennessee, Alabama, and Mississippi.
Read the story.
Tuesday, October 4, 2016
HMDA: Credit Unions Originated 9 Percent of All Mortgages in 2015
Credit unions in 2015 accounted for 9 percent of all mortgage originations, according to Home Mortgage Disclosure Act (HMDA) data.
There were 1,971 credit unions that filed HMDA data.
The following information appears in Table 10 in this report.
In 2015, HMDA filing credit unions had slightly more than 1.1 million applications and 670 thousand originations.
According to 2015 HMDA data, 1,061 credit unions had fewer than 100 loans and 419 credit unions had less than 25 loans.
Approximately 5 percent of home-purchased loans by credit unions were higher-priced loans. Credit unions accounted for slightly more than 15 percent of higher-priced home-purchased loans.
Higher-priced first-lien loans are defined as those with an annual percentage rate (APR) of at least 1.5 percentage points above the average prime offer rate (APOR) for loans of a similar type (for example, a 30-year fixed-rate mortgage). The spread for junior-lien loans must be at least 3.5 percentage points for such loans to be considered higher priced.
Credit unions originated 14.8 percent of their home-purchased loans to minority borrowers. In comparison, almost 20 percent of such loans went to minority borrowers.
Credit unions sold less than one-half of the home-purchase loans they originated and a little more than one-third of the refinance loans they originated.
There were 1,971 credit unions that filed HMDA data.
The following information appears in Table 10 in this report.
In 2015, HMDA filing credit unions had slightly more than 1.1 million applications and 670 thousand originations.
According to 2015 HMDA data, 1,061 credit unions had fewer than 100 loans and 419 credit unions had less than 25 loans.
Approximately 5 percent of home-purchased loans by credit unions were higher-priced loans. Credit unions accounted for slightly more than 15 percent of higher-priced home-purchased loans.
Higher-priced first-lien loans are defined as those with an annual percentage rate (APR) of at least 1.5 percentage points above the average prime offer rate (APOR) for loans of a similar type (for example, a 30-year fixed-rate mortgage). The spread for junior-lien loans must be at least 3.5 percentage points for such loans to be considered higher priced.
Credit unions originated 14.8 percent of their home-purchased loans to minority borrowers. In comparison, almost 20 percent of such loans went to minority borrowers.
Credit unions sold less than one-half of the home-purchase loans they originated and a little more than one-third of the refinance loans they originated.
Friday, December 11, 2015
Self-Help CU Funds $18 Million Construction Loan for Miami Charter School
The Sports Leadership and Management Academy charter school obtained a $17.97 million construction loan from a North Carolina-based credit union to build its complex in Miami’s Little Havana.
Self-Help Credit Union granted the mortgage to Miami School Group for an 80,552-square-foot school.
The school was co-founded by Christian Perez, also known as recording artist Pitbull.
However, how can a credit union based in Durham, N.C. provide a $18 million construction loan for school in Miami, Florida co-founded by Pitbull?
What is the common bond?
The best guess is a $5 one-time donation to the Center for Community Self Help.
Read the story.
Self-Help Credit Union granted the mortgage to Miami School Group for an 80,552-square-foot school.
The school was co-founded by Christian Perez, also known as recording artist Pitbull.
However, how can a credit union based in Durham, N.C. provide a $18 million construction loan for school in Miami, Florida co-founded by Pitbull?
What is the common bond?
The best guess is a $5 one-time donation to the Center for Community Self Help.
Read the story.
Wednesday, December 9, 2015
San Francisco FCU Unveils 100 Percent LTV Jumbo Mortgages
Citing skyrocketing housing costs, San Francisco Federal Credit Union announced a new loan program that will allow San Francisco-area borrowers to finance up to 100 percent of their mortgage – with no requirement for private mortgage insurance – on loans up to $2 million.
The new loan program is called POPPYLOAN, which stands for Proud Ownership Purchase Program for You.
According to the credit union, POPPYLOAN is available to anyone who works in San Francisco or San Mateo Counties and can be used to purchase a home in the nine Bay Area Counties: San Francisco, San Mateo, Marin, Napa, Sonoma, Santa Clara, Alameda, Contra Costa, or Solano.
To qualify for POPPYLOAN, borrowers must be 18 years or older and purchasing a single family home, townhouse, condominium, or 2-to-4 unit multi-family dwelling as their primary residence. Eligibility for the loan also depends on a number of additional factors, such as credit scores, income, employment status, and property value.
POPPYLOAN is structured as a 5/5 adjustable rate, 30-year mortgage. The interest rate on the mortgage cannot increase by more than 2 percent every five years and no more than 6 percent over the life of the loan.
However, the loan is not available to refinance an existing mortgage.
Read the article.
The new loan program is called POPPYLOAN, which stands for Proud Ownership Purchase Program for You.
According to the credit union, POPPYLOAN is available to anyone who works in San Francisco or San Mateo Counties and can be used to purchase a home in the nine Bay Area Counties: San Francisco, San Mateo, Marin, Napa, Sonoma, Santa Clara, Alameda, Contra Costa, or Solano.
To qualify for POPPYLOAN, borrowers must be 18 years or older and purchasing a single family home, townhouse, condominium, or 2-to-4 unit multi-family dwelling as their primary residence. Eligibility for the loan also depends on a number of additional factors, such as credit scores, income, employment status, and property value.
POPPYLOAN is structured as a 5/5 adjustable rate, 30-year mortgage. The interest rate on the mortgage cannot increase by more than 2 percent every five years and no more than 6 percent over the life of the loan.
However, the loan is not available to refinance an existing mortgage.
Read the article.
Wednesday, November 25, 2015
IG Report Recommends NCUA Add S to CAMEL Rating
The National Credit Union Administration (NCUA) Office of Inspector General (IG) recommended that NCUA add sensitivity to market risk (S) to its CAMEL rating.
Almost two decades earlier (January 1, 1997), the federal bank regulators -- The Federal Reserve, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency -- added S to their CAMELS rating.
The IG report noted that NCUA may not be effectively capturing interest rate risk (IRR) under "L" in its CAMEL rating.
The IG wrote:
Read the report.
Almost two decades earlier (January 1, 1997), the federal bank regulators -- The Federal Reserve, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency -- added S to their CAMELS rating.
The IG report noted that NCUA may not be effectively capturing interest rate risk (IRR) under "L" in its CAMEL rating.
The IG wrote:
[w]e determined that NCUA may not be effectively capturing IRR when assigning a composite CAMEL rating to a credit union. NCUA currently assesses sensitivity to market risk under the "L" in its CAMEL rating. However, combining sensitivity to market risk with liquidity may understate or obscure instances of high IRR exposure in a credit union. The addition of an “S” rating to its CAMEL Rating System to capture and separately assess a credit union’s sensitivity to market risk should improve NCUA’s ability to accurately measure and monitor interest rate risk. To better reflect the risk that changes in market rates will adversely affect a credit union’s capital and earnings, and in conjunction with a stated goal of NCUA’s IRR working group, we are making two recommendations in this report. We recommend NCUA management modify the current CAMEL Rating System by adding an “S” for market risk [S]ensitivity, and revising the “L” rating to reflect only liquidity factors.
Read the report.
Wednesday, September 23, 2015
2014 HMDA-Reporting CUs Accounted for More Than 9 Percent of Mortgages
The 2014 Home Mortgage Disclosure Act (HMDA) data show that credit unions continued to gain mortgage market share, as their mortgage share reached historic highs.
According to the HMDA data, there were 1,984 HMDA-reporting credit unions. However, most HMDA-filing credit unions (1,150 institutions) originated fewer than 100 mortgages in 2014.
These HMDA-filing credit unions reported having 909 thousand applications and 545 thousand originations in 2014. Credit unions accounted for a little over 9 percent of all mortgage originations.
The report notes that nearly 9 percent of conventional mortgages for home purchase were higher-priced loans by credit unions. The report points out that small banks and credit unions originate a disproportionately higher share of high-priced mortgage loans compared to other lenders.
In addition, the HMDA data showed that the percent of conventional mortgages held in portfolio at credit unions have declined over time. In 1995, credit unions held over 80 percent of such loans in portfolio. By 2014, it had fallen to 61 percent.
Check out here Tables 11, 13 and 14 for more information on mortgage lending by lender type.
According to the HMDA data, there were 1,984 HMDA-reporting credit unions. However, most HMDA-filing credit unions (1,150 institutions) originated fewer than 100 mortgages in 2014.
These HMDA-filing credit unions reported having 909 thousand applications and 545 thousand originations in 2014. Credit unions accounted for a little over 9 percent of all mortgage originations.
The report notes that nearly 9 percent of conventional mortgages for home purchase were higher-priced loans by credit unions. The report points out that small banks and credit unions originate a disproportionately higher share of high-priced mortgage loans compared to other lenders.
In addition, the HMDA data showed that the percent of conventional mortgages held in portfolio at credit unions have declined over time. In 1995, credit unions held over 80 percent of such loans in portfolio. By 2014, it had fallen to 61 percent.
Check out here Tables 11, 13 and 14 for more information on mortgage lending by lender type.
Wednesday, August 12, 2015
TransUnion: CUs Have Greater Appetite for Mortgages
A study by TransUnion found that while auto lending by credit unions is still viewed as the top loan category for future growth, credit unions have a greater appetite for originating mortgages compared to the rest of the financial services industry.
According to TransUnion, the share of all mortgage originations by credit unions has increased from 7 percent in Q1 2013 to 11 percent in Q1 2015.
In addition, a survey of 90 credit union executives by TransUnion found that six in 10 respondents stated that mortgage originations (ranked in the top 3 loan products) were an area of growth/opportunity/focus for their credit unions in the next 12 months. This is up from 50 percent in the 2014 survey.
TransUnion also noted that credit unions experienced 25 percent growth in non-prime mortgage originations in Q1 2015 compared to 4 percent for the rest of the industry.
Read the press release.
According to TransUnion, the share of all mortgage originations by credit unions has increased from 7 percent in Q1 2013 to 11 percent in Q1 2015.
In addition, a survey of 90 credit union executives by TransUnion found that six in 10 respondents stated that mortgage originations (ranked in the top 3 loan products) were an area of growth/opportunity/focus for their credit unions in the next 12 months. This is up from 50 percent in the 2014 survey.
TransUnion also noted that credit unions experienced 25 percent growth in non-prime mortgage originations in Q1 2015 compared to 4 percent for the rest of the industry.
Read the press release.
Wednesday, April 8, 2015
Report: Oregon CUs Poor Record of Mortgages to Low-Income Borrowers
A report analyzing Oregon credit unions’ mortgage lending found the industry made 11,775 home mortgage loans in 2013, but less than one percent – 96 mortgages - went to low-income households.
Credit unions were granted non-profit, tax-exempt status in order to serve persons of “modest means,” but recently released Home Mortgage Disclosure Act data is calling that mission into question.
According to the report,
Read the report.
Credit unions were granted non-profit, tax-exempt status in order to serve persons of “modest means,” but recently released Home Mortgage Disclosure Act data is calling that mission into question.
According to the report,
- Of the 11,775 mortgages originated by Oregon credit unions last year, less than one percent – 96 mortgages - went to low-income borrowers - less than one percent. 14 percent went to moderate income; 53 percent went to middle income; 32 percent went to upper income.
- Oregon credit unions made 18 mortgage loans on homes of $1 million or more. OnPoint Community Credit Union, the state’s largest credit union, made four mortgage loans on homes of $1 million or more.
- Oregon’s five largest credit unions averaged only one percent of their mortgage originations to low-income individuals.
- There were seven Oregon credit unions that originated loans to ONLY upper income individuals.
Read the report.
Thursday, February 26, 2015
CU Released from Real Estate Loan Moratorium
I just found out about another secret administrative order against a credit union by the National Credit Union Administration (NCUA) only after the credit union announced that it was no longer under the order.
According to a news report, the president of Holyoke Community Federal Credit Union (Holyoke, CO) at its February 23 annual meeting announced that NCUA had released the credit union from its real estate moratorium allowing credit union to resume making real estate loans.
The credit union did not originate a mortgage loan for all of 2014.
Read the story.
According to a news report, the president of Holyoke Community Federal Credit Union (Holyoke, CO) at its February 23 annual meeting announced that NCUA had released the credit union from its real estate moratorium allowing credit union to resume making real estate loans.
The credit union did not originate a mortgage loan for all of 2014.
Read the story.
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