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NEW YORK – The National Federation of Community Development Credit Unions’ effort to help community development credit unions offer their lower income members more mortgages is underway. The Federation intends the new CDCU Mortgage Center to both provide CDCUs with training and expertise they need to make more mortgage loans as well as provide them with a secondary market to sell the loans which the mainstream secondary either would not buy or would discount heavily because it considers them nonconforming. The center purchased its first mortgages at the end of 2005. The $184 million Self Help Credit Union originated the mortgages, the Federation said, which had been offered to recent immigrants who used Individual Taxpayer Identification Numbers rather than Social Security numbers. “ITIN mortgages are just one example of the performing, but nontraditional, loans that can help build wealth in underserved communities,” explained Federation Executive Director Cliff Rosenthal. “Other loan types include cooperative and manufactured housing loans. We plan to expand the market for these as well as more conventional loans in low- and moderate-income communities, and to help credit unions recycle their capital many times over while managing their balance sheets for better asset/liability management.” The Federation has partnered with two well-known mortgage firms in this effort. CU Partners and PHH Mortgage Services will provide CDCUs with many tools they can use to offer mortgages to low-income members who might need extra help or who can only get mortgages that the secondary market would consider nonconforming. Rosenthal said that the center is using $1 million it received from the U.S. Treasury’s Community Development Financial Institutions Fund and low-interest loans and grants it has received from other funding institutions. The eventual goal is to reach $12 million in capitalization and to sell some of the nonconforming loans after they have matured and “seasoned” for a number of years, Rosenthal said. The Federation hired Terri J. Fowlkes, a former executive with the Carver Federal Savings Bank, the nation’s largest minority thrift, as director of the center. A vice president with Carver, Fowlkes was responsible for managing all aspects of the bank’s one-to-four family residential lending work. Within a year of joining the bank, her unit grew mortgage originations by more than 400% and increased profitability by 600%. “We were also impressed by her team-building and organizational development skills,” Rosenthal commented. Fowlkes recruited a mortgage team, developed systems, expanded mortgage product offerings, and developed mortgage-related partnerships and resources for the bank. [email protected]

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