MADISON, Wis. (10/5/11)--Credit unions must create their own opportunities in the midst of a difficult mortgage lending environment, a CMG Mortgage Insurance Company (CMG MI) regional sales director, told an Online Discovery audience Tuesday. Online Discovery is CUNA Mutual Group’s free Web-based conference. The event attracted a national and international audience of more than 1,800 credit union and league staff. Mortgage lending is key to keeping members from defecting to banks over the long run, said Ira Oskowsky, who heads CMG MI’s eastern sales division. “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. Credit unions’ share of the mortgage market had climbed to 10% but recently dropped back down to about 3%, according the American Credit Union Mortgage Association. “How can we climb back up? By making our own opportunities and not just relying passively on member loyalty to see us through,” Oskowksy said. Among the best practices Oskowsky recommended in the session:
* Put real estate lending at the center of the credit union’s strategy; * Create a team of loan officers to proactively approach members and real estate agents; * Expand product mix to include more first-time homebuyer programs, specialty products and portfolio options; * Think about how consumers shop for mortgages and homes, and adjust credit union schedules to include weekend hours and online mortgage applications; * Initiate new relationships--or enhance existing ones--with mortgage aggregators; and * Step up and accept the role of home finance expert in advise members.
Oskowsky asked if mortgage lending is a good option for credit unions in the current housing market. Mortgage loans will always have some of the highest margins compared to other investments, he said. “As for risk, if you mitigate it effectively, then mortgages actually represent the lowest risk of any investment,” he added. “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.” Watch for more coverage of the Online Discovery sessions in Thursday’s News Now
. Also, see related story, "Data breaches now No. 1 fraud type--CUNA Mutual," in today's System News.