Credit unions can expect stronger than average opportunities for lending this year and preparations are already underway to grow portfolio revenue.

CU Times spoke to three lending officers and while the executives acknowledged they could not predict the future, all agreed on not paying too much attention to negative economic news, choosing instead, to focus on tapping into 2015's potentially strong loan demand.

“It might be easier to ask what aren't we doing,” Ahmed Campbell, vice president of credit operations at the $2 billion Municipal Credit Union in New York, said.

The cooperative was working across a wide variety of products and is particularly revving up for a possible surge in auto loans.

“We're sensing a really deep, pent-up demand for automobiles,” Campbell said.

Some of Municipal's 364,000 members had been holding off on replacing aging cars for most of the recession and were looking forward to getting some new wheels as well as used vehicles.

Campbell said the credit union will continue to work with members who desire new cars. In addition, it plans to target its sweet spot of used car loans for those with B or C credit paper. These borrowers are often either at the most risk for getting an unfair or predatory loan from another lender or not getting enough financing to buy the vehicle they really need.

“Auto loans are really a place where we can have our strongest impacts,” Campbell said.

Municipal is also working on its mortgage program for purchase money loans, which he acknowledged remains a challenge with New York's high real estate prices. The credit union expects a strong demand for home equity loans too.

“We have members who have been putting off making necessary repairs of renovations for a while,” Campbell said.

The $724 million, 49,000-member Point Breeze Credit Union in Hunt Valley, Md., is preparing for a stronger lending environment in 2015, however, local factors might create some limits, according to Tricia Harrison, chief lending officer.

“I think the economic recovery might be lagging for us a bit,” she said, pointing to a looming budget gap facing Maryland's government that will have to be addressed sometime this year.

Nonetheless, Point Breeze is preparing to help its members with robust auto loan, credit card and home equity loan programs while continuing its efforts to educate borrowers on loans and other related responsibilities.

Aaron Bresko, chief lending officer at the $1.6 billion, 225,000-member GTE Financial, said the Tampa, Fla.-based credit union was focused on helping members take out loans and using financial services to help them recover from the recession.

A recent decision from Fannie Mae and Freddie Mac on buying housing finance loans of up 97% of property value provided a green light for the credit union to begin offering more of these loans, Bresko said.

Read more: GTE Financial eases LTV requirements …

GTE Financial will offer higher LTV loans as purchase money notes to buy new property and to help homeowners who still need to refinance existing loans but were not been able to do so. The credit union has also started offering construction loans and loans for undeveloped investment properties.

Bresko said GTE Financial has been working hard with its credit card processing partner to market its credit card. The credit union has been recognized as having the lowest rate credit card in the Tampa Bay area, he added.

“We want to keep making that better known,” Bresko said.

Indeed, the signs are pointing to a better forecast compared to the past few years.

Consumer finance website WalletHub asked a panel of economists, consumer and public policy experts for their 2015 predictions and where they expected the U.S. gross domestic product to end up.

The GDP will come in at roughly 3%, which will drive unemployment to 5% and wages by 3%, according to the panel. Meanwhile, auto makers will sell 17 million new cars this year, easing more older cars into the used car market and drive up the demand for both new and used car loans.

Home sales, in many ways, have been the slowest part of the economic recovery, but will post an increase this year, the WalletHub panel said.

However, WalletHub Senior Editor John Kiernan said the rosy economic forecast retained some of the gray edges associated with unpredictability and many good things impacting the economy can have unintended negative consequences.

“Oil prices,” Kiernan said. “A drop in oil prices and gas prices can help fuel consumer confidence and consumer spending along with loan demand. But low prices also raise geopolitical issues that could derail growth, so that's one.”

He added, “The continued poor economic performance in Europe, one of our major trading partners, could also rain on the U.S. parade, so that's another, and nothing carries a guarantee.”

Read more about what credit unions are expecting in 2015 in the Jan. 14 issue of Credit Union Times.

Instant Insights /

Loan Gush Flows Into New Year

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