X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

MADISON, Wis. – As 2005 winds down, there seems to have been no shortage of unexpected news announcements coming out of CUNA Mutual Group for the year. One of the surprise announcements came in October and concerned CUNA Mutual Group’s decision to sell its mortgage operation – CUNA Mutual Mortgage Corp. – to PHH Mortgage, a subsidiary of PHH Corp. headquartered in Mount Laurel, N.J. The company is a leading provider of mortgage and vehicle fleet management services. In announcing the company’s decision, CUNA Mutual Group CEO Jeff Post said the move was necessary to prepare the company for the future which he said meant focusing more closely on what it considers to be its core competencies. He described it as “the first step in building a new CUNA Mutual, a company that remains committed to the credit unions but doesn’t try to be all things to all credit unions.” Under the terms of the agreement, PHH Mortgage acquired certain mortgage-related assets oF CUNA Mutual Mortgage and assumed origination, servicing and sub-servicing contracts reportedly worth $2.9 billion. Up until the sale, CUNA Mutual had been involved with helping CUs with their mortgage business since 1978 first when the CUNA Service Group and the CUNA Mutual Investment Group began a joint effort. Then in 1998, CUNA Mutual Group bought CUNA Mortgage Group from CUNA and Affiliates. In 2000 it merged it with CU Mortgage of California to form CUNA Mutual Mortgage Corp., the largest credit union-centered mortgage company serving at the time more than 700 correspondent/wholesale credit unions and 350 direct-to-member credit unions. At the time of the sale, the company had business relationships with about 1,400 credit unions nationwide. However, the majority of that business was concentrated in a fraction of those credit unions. CUNA Mutual Mortgage was servicing about $10 billion in loans with credit unions, and in 2004 the origination volume was approximately $1.25 billion. PHH Mortgage has been serving credit unions since 1989. With the purchase, the company doubles the number of credit unions it serves as a mortgage provider, from 500 to more than 1,000. In addition, its servicing portfolio for credit unions increases to about $16 billion. While it assured credit unions the sale would ensure them continuing to receive “best-in-class mortgage services,” that was small consolation to the 175 CUNA Mutual employees who were caught in the cross-fire and faced being laid off or reassigned to other areas and jobs in the company. Many credit unions that had done business with CUNA Mutual Mortgage and preferred to partner with a credit union company also felt the fallout from the sale. Several of them signed on with New credit union-owned mortgage companies or CUSOs such as Mortgage Markets CUSO, East Hartford, Conn. -

Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times

Copyright © 2019 ALM Media Properties, LLC. All Rights Reserved.