HERNDON, Va. – The 12 charter investors of CU Realty of VA, MD, DC LLC had good reason to celebrate last month. Not only was it the CUSO's first anniversary, but the company has proven to be a three-way win – for credit unions, members and realtors. CU Realty of VA, MD, DC LLC (CUR LLC), a chapter of parent company CU Realty Services of Scottsdale, Ariz., did more than $30 million in mortgages in its first year, and paid out $842,200 in cash rebates to members. The CUSO's charter investors include: Agriculture FCU, Apple FCU, Bank-Fund Staff FCU, Fairfax County FCU, HW FCU, Justice FCU, NASA FCU, Newport News Shipbuilding Employees' CU, Northwest FCU, State Department FCU, Tower FCU and CU-owned Credit Union Mortgage Association. In addition, last year four additional CUs signed on as CUR LLC clients – Transportation FCU, Wright Patman Congressional FCU, Money One FCU, and Arlington Virginia FCU. Colleen Daly, CUR LLC President and president of Northwest FCU, admits that when the CUSO opened for business "we weren't sure how it would take off with the members. We knew the realtors would like it because there was another similar CUSO in Colorado and they had a waiting list for realtors who wanted to join the program. But we were more unsure about the members. Getting them to register with one our agents, conduct their transaction with their credit union and for the credit union to get the mortgage is the goal," she explained. CUR LLC is designed to assist members through every step of the home buying and selling process. The CUSO provides members with free online tools including unrestricted access to the same multiple listing service (MLS) database real estate agents use; a "report card" on local schools complete with student-teacher ratios, class sizes and special programs; and neighborhood demographics and maps. Members receive a rebate of the sales price if the home is bought or sold through a CU Realty approved agent. They also receive it – and here's the main challenge for the CUSO, said Daly – regardless if the member gets their mortgage from their credit union or from another lender. "Since the credit union has established a relationship with the realtor, then it behooves the realtor to steer the member to the credit union. If they don't make an attempt to offer the credit union financing to the member, then the realtor won't be part of the program for very long," Daly explains. "However, it's a violation of RESPA for us to tell the member they have to get their mortgage from their credit union." She added though that 65% of the registered members purchasing a home secured their financing from a credit union. Daly said the CUSO's goal for 2006 is to see that number go up to 80% She thinks that's entirely doable even though the refi boom is over. "I think there are enough purchase mortgages out there for credit unions to have a good year. We have to work on our relationships with realtors and get the word out to them and to our members about the mortgage products credit unions offer," Daly said. There are currently 45 realtors working with CUR LLC among the three states, and there's a waiting list of 100 realtors. Daly said the CUSO deliberately doesn't put too many realtors in the program "because we don't want to dilute the pool and wind up with each realtor getting too few leads." Many of the 45 realtors in the program now, she said, were working with the 12 charter investors before the CUSO was formed. All the realtors go through extensive training before they begin working with the CUSO that consists of learning about the program, how it works, the credit union philosophy and what the membership means to credit unions. "The key to the success of the program and credit unions' relationships with the realtors is that the credit unions have to have a competitive and solid mortgage program. That means, for example, if a realtor wants to get Northwest FCU a loan, the member has to be pre-approved and the realtor has to be able to communicate with the credit union when they need to talk with them and not just leave voicemail messages. The credit union has to be accessible to the realtor and be willing to share information," says Daly. Judging from its performance in 2005, CUR LLC's formula is working – last year it was looking for a .25% registration penetration among members, and the CUSO achieved a 1% registration penetration; the estimate was that for every 30 registrations the CUSO should expect one closed deal. It finished at every 23 registrations resulting in a closed deal; the initial goal was 40% of the buyers would choose their CU for financing, and it achieved 65% as a CUSO. "The biggest part of our success is due to the fact that we've taken the time to work with the realtors and they with us, and the member wins," she adds. -

[email protected]