That's the advice of Tracy Ashfield, who specializes in helping credit unions develop mortgage programs.
Ashfield, who spoke at NASCUS' State System Summit, urged credit unions to: Have proactive refinancing programs, especially for ARMs; focus on helping members get their first homes; and focus on product quality, delivery systems and relationship building.
She praised a lending program by Community First Credit Union in Appleton, Wisconsin, which provides no-interest $8,000 loans to first-time buyers. Members use the money for a down payment and repay it when they receive the $8,000 tax credit from the IRS.
She also urged attendees to manage interest rate risk, but also focus on credit risk.
When there are signs that a member could have trouble making mortgage payments, credit union employees should do an early intervention, Ashfield said. But she cautioned that sometimes foreclosure is the best available option for a member, as painful as that can be.
Those who originate mortgages will be subject to new rules, because of a law passed by Congress and rules being issued by federal regulators.
New rules for regulating mortgage originators will be less onerous for credit unions and other regulated depository institutions, bank regulation expert Mike Stevens told attendees.
Stevens said credit unions and their employees will have to register with a new national registry but won't have to attain a separate license.
The proposed rules, which implement a law passed by Congress last year, require information such as employment and history to be included. The public will have access to some data so they can decide if they want to do business with an originator but other data, such as financial information, won't be available.
The proposed rules, which regulators are reviewing following a public comment period, would allow credit unions that originate 25 or fewer loans to be exempt from the registry as long as no one individual on their staff originates more than five loans.
Stevens, the senior vice president for regulation at the Conference of State Bank Supervisors, said the law was passed in light of the financial crisis, which was caused by some of the bad mortgages issued during the past few years. The implementation rules were sent out for public comment and regulators are reviewing the comments before issuing final regulations.