RALEIGH, N.C. & MEMPHIS, Tenn. — When credit unions make a commitment to offer home loans and ramp up efforts to help members trapped in resetting adjustable-rate mortgages granted by other financial institutions, they are doing no less than what the Federal Credit Union Act demands they do. So says Jim Blaine, president/CEO of State Employees' Credit Union of North Carolina, the Tar Heel State's largest.

True to form, SECU created two new mortgage products to help such members with a five-year ARM and an All Savers Mortgage. The ARM loan provides members with the payment stability needed to rebound from financial hardships and allows those recovering from subprime mortgage problems to budget with more certainty. It allows for 100% financing up to $400,000 with a maximum term of 20 years. The rate is subject to change only every five years, but will not change more than 1.5% each increment and has a maximum increase limit of 4.5% over the life of the loan.

The All Savers Mortgage provides a fixed rate of interest plus an opportunity to establish a substantial savings account. The mortgage features 100% financing, a 15-year term and a maximum loan amount of $400,000. Once the loan amount is established, an additional 10% is financed to open a share-term certificate with a rate equal to the mortgage loan. Dividends for the STC are compounded monthly and remain in the STC account until it is closed. Funds are released to the member upon the earliest of the following: 10 years after the loan origination; payoff of the mortgage; or when the mortgage balance is reduced below the amount of the STC balance. Members may then use the funds for education expenses, home improvements, to pay down the remaining mortgage–or as a nest egg for retirement.

The Memphis Area Teachers Credit Union worked with others including the Federal Home Loan Bank of Cincinnati, Alpha Omega Veterans' Services, the City of Memphis, United Housing, and the Tennessee Department of Mental Health and Developmental Disabilities, to build a home for a homeless veteran and three others for worthy buyers.

Carlos Webb, president/CEO at MATCU said Carol Peterson of the FHLB of Cincinnati came to ask if MATCU was interested in adopting the American Dream Home program that was orphaned by now-closed banks in the area and Webb said yes.

Webb noted that it takes the concerted efforts of other organizations and various public and private agencies working together to fulfill that dream. But when it works, it's a beautiful thing, allowed John Bridgeforth, the Army vet who is now busy thinking of what flowers to plant in his garden.

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