Credit Union Lending Programs Earn Top Honors
For their business, consumer and mortgage lending efforts, five credit unions were recognized Monday for their loan programs.
The CUNA Lending Council and CUNA Mutual Group named the recipients of the Excellence in Lending awards, which were presented at the council’s annual conference in Phoenix to the following credit unions:
- $453 million Consumers Credit Union, Kalamazoo, Mich.: consumer lending, assets more than $250 million
- $227 million Texell Credit Union, Temple, Texas: consumer lending, assets less than $250 million
- $764 million Texas Trust Federal Credit Union, Mansfield, Texas: mortgage lending, assets more than $250 million
- $38.5 million Limestone Federal Credit Union, Manistique, Mich.: mortgage lending, assets less than $250 million
- $32 million Upper Cumberland Federal Credit Union, Crossville, Tenn.: mortgage lending, assets less than $250 million
- $1.6 billion GTE Financial, Tampa, Fla.: business lending
- Texell Credit Union: low-to-modest means
CONSUMER – Assets More than $250 Million
Consumers CU’s “Silver Lining” home equity loan program was aimed at meeting a need for near-retirees with good credit and equity with a desire to pay off their mortgages before retirement. A no-closing cost home equity loan, Silver Lining, is a three, five, seven or 10-year loans as low as 2.99% that allows members to accelerate debt repayment and consolidate debt.
CONSUMER – Assets Less Than $250 Million
Texell CU found that by developing new products and underwriting procedures, implementing a sales-driven, relationship-building culture and by making a number of operational improvements, it achieved the highest loan-to-share ratio in its history, including higher average loan balances per member and more members that are borrowers. At the end of 2007, about 22.9% of members were borrowers. By the end of 2012, that number increased to more than 51%. At the same time, average loan balances increased from $9,249 to $10,736.
MORTGAGE – Assets More Than $250 Million
Texas Trust CU started stabilizing its mortgage operation by aligning staff, improving efficiencies and making sure the right people were in positions to meet the challenge. With more than 50% of its production being home equity loans, Texas Trust identified market needs and began marketing what turned out to be more than 100 different first and second lien mortgage choices. Those awareness efforts paid off with member penetration for mortgage lending increasing from two percent to 15%.
MORTGAGE – Assets Less Than $250 Million
Limestone FCU took a deep dive into the credit union’s shortcomings and opportunities included polling members and rating products and services. When 10-year, fixed rate mortgages were offered, members thought they couldn’t afford them, but by educating them against the “buy now, pay late” mentality, many members were put on a path to becoming financially independent, the award announcement said.
MORTGAGE – Assets Less Than $250 Million
Upper Cumberland FCU created a 10-year, fixed-rate product with a 3.99% APR with no origination fees for members that owed $75,000 or less on their home and had a minimum credit score of 680. The mortgage hit a special need in the community as many members consolidated all their debt into one payment, the credit union said.
GTE Financial had a business loan portfolio heavy on large commercial loans on hotel property during a collapsing economy. In October 2010, the credit union’s business services staff decided to bring the credit union philosophy to the small business community with a focus on building relationships and providing loans to local, small businesses, which were ignored by competitors. The new strategy put lending targets at $750,000 and under. By building relationships with the local, small businesses, GTE Financial had less competition, more opportunity, and reduced risk.
Texell CU has transformed its lending strategy to better serve a predominantly low-income membership base. That transformation has propelled loan performance to the highest in the credit union’s history, including the highest loan-to-share and borrower-to-member ratios in the credit union’s history. Some of those loans include Holiday Loans, a payday alternative extended, regardless of credit score; Yes! Loans, aimed at members and potential members previously denied loans and Aspire Credit Card, a partially or fully secured card.