Mortgages: Make Your Own Opportunities

CUs can boost mortgage lending despite difficult times.

October 19, 2011
KEYWORDS lending , mortgage
/ PRINT / ShareShare / Text Size +

Amid the continuing slump in housing markets and lenders scrambling for market share, credit unions are finding it difficult to grow their mortgage lending operations.

This difficult environment requires credit unions to make their own opportunities, a CMG Mortgage Insurance Co. (CMG MI) regional sales director, told Online Discovery Conference attendees Tuesday.

Ira Oskowsky, who heads CMG MI’s eastern sales division, said mortgage lending is key to keeping members from defecting to banks over the long run.

“When credit unions don’t offer mortgages, a bank can move in quickly to persuade members to transfer all their business,” Oskowsky said. “And if the credit union does offer mortgages, it needs to do it competitively. Not just with pricing, but with products, ease of use, and by building a relationship with your local real estate agents.

“The American Credit Union Mortgage Association reported that over the last three years, credit unions’ share of the market climbed to just under 10% but tumbled back down rapidly to about 3%,” he continued. “How can we climb back up? By making our own opportunities and not just relying passively on member loyalty to see us through.”

Among the best practices Oskowsky recommends:

  • Put real estate lending at the center of the credit union’s strategy;
  • Create a team of loan officers to approach members and real estate agents;
  • Expand the product mix to include more first-time homebuyer programs, specialty products, and portfolio options;
  • Think about how people shop for mortgages and homes, and adjust the credit union’s schedule accordingly (i.e., weekend hours, online mortgage applications);
  • Initiate new relationships—or enhance existing ones—with mortgage aggregators; and
  • Accept the role of home finance expert when advising members.

Oskowsky said mortgages will have some of the highest margins compared to other investments. “As for risk, if you mitigate it effectively, then mortgages actually represent the lowest risk of any investment.

“Develop your strategy carefully, but recognize that mortgage lending, handled wisely, can be the best way to replenish liquidity, improve member relationships, and win business away from banks. Becoming full-service credit unions is the future for our industry.”

Post a comment to this story


What's Popular

Popular Stories

Recent Discussion

Great article! Unfortunately, most employees don’t feel valued or appreciated by their supervisors or employers. In fact, research has shown that the predominant reason team members quit their jobs is because they don’t feel valued. This is in spite of the fact that employee recognition programs have proliferated in the workplace – over 90% of all organizations in the U.S. has some form of employee recognition activities in place. But most employee recognition programs are viewed with skepticism and cynicism – because they aren’t viewed as being genuine in their communication of appreciation. Getting the “employee of the month” award, receiving a certificate of recognition, or a “Way to go, team!” email just don’t get the job done. How do you communicate authentic appreciation? We have found people have different ways that they want to be shown appreciation, and if you don’t communicate in the language of appreciation important to them, you essentially “miss the mark”. Additionally, employees need to receive recognition more than once a year at their performance review. Otherwise, they view the praise as “going through the motions”. A third component of authentic appreciation is that the communication has to be about them personally – not the department, not their group, but something they did. Finally, they have to believe that you mean what you say. How you treat them has to match the words you use. If you are not sure how your team members want to be shown appreciation, the Motivating By Appreciation Inventory (www.appreciationatwork.com/assess) will identify the language of appreciation and specific actions preferred by each employee. You then can create a group profile for your team, so everyone knows how to encourage one another. Remember, employees want to know that they are valued for what they contribute to the success of the organization. And communicating authentic appreciation in the ways they desire it can make the difference between keeping your quality team members or having a negative work environment that everyone wants to leave. Paul White, Ph.D., is the co-author of The 5 Languages of Appreciation in the Workplace with Dr. Gary Chapman.

Your Say: Who should be Credit Union Magazine's 2014 CU Hero of the Year?

View Results Poll Archive