LAKELAND, Fla. — Even though MIDFLORIDA Federal Credit Union had been offering mortgages for at least a decade, the credit union bought one of the state's largest real estate brokers to increase its presence in central Florida and offer better deals than its competitors.The $1.3 billion credit union acquired A.H. Realty on Dec. 3. A.H. Realty will be renamed MIDFLORIDA Real Estate Sales LLC and Andy Hernandez, its principal, has been named the president of the new CUSO, which will be a wholly owned subsidiary of the credit union. Financial terms of the deal were not disclosed. The new entity will encompass the entire home-buying experience from listing to closing including sales, mortgage lending, title work and homeowners insurance."We've had mortgages for years," said Kevin Jones, president/CEO of MIDFLORIDA FCU. "Our main motivation was most real estate companies feed their business to an in-house company, which is usually located out of state. We felt like our [members] were not getting the best product and the best deal and of course, we were not getting the business."Plans are already in place to hit the ground running with the new acquisition, Jones said. The credit union has set out to increase agency sales to more than 500 units in the first year of operation and to continue to build sales until MIDFLORIDA Real Estate Sales is one of the top providers in the market. Jones said those ambitious plans will be realized through the acquisition of additional real estate agencies and the recruitment of more agents.The CUSO currently uses 30 independent contractors instead of employees of the credit union, Jones noted. As incentives, realtors will have access to a compensation package comprising health care insurance, pool cars for showing properties and a "no-fee environment" free of franchise, desk or monthly fees.MIDFLORIDA Real Estate Sales will continue to operate temporarily at the existing A.H. Realty sites in Lakeland and Winter Haven. By the end of 2009, the main real estate office will relocate to the area adjacent to MIDFLORIDA FCU's Hollingsworth branch. The 8,000-square-foot site will later become the regional headquarters for the new CUSO. A total of five offices will house the real estate subsidiary by the end of next year.Meanwhile, the credit union has a healthy $216 million first mortgage loan portfolio as of Nov. 30 and years ago, launched its own realty company from the ground up, which has been shut down to place emphasis on MIDFLORIDA Real Estate Sales. Still, it is based in Florida, one of the worst states in the nation when it comes to foreclosures. Jones is confident that the acquisition's timing is ideal."The thought was this is a better time because the market is so weak. Very few are making money at this point," Jones acknowledged. "But Florida, historically, has a very strong real estate market. While I agree with economists that we're in a sales slump, I believe the value will come back."That belief is bolstered by the falloff off some of the industry's biggest mortgage players including Countrywide Financial and Indy Mac, Jones said, adding MIDFLORIDA FCU had record sales this year as a result. The credit union has continued to nurture its relationship with local builders and plans to stick to its existing member base for now rather than seeking out purchase money.In its quest to find the right mortgage company, the credit union had casual conversations with a couple of other agencies in addition to A.H. Realty, Jones said. One concern was most were "one-man shows" that lacked the structure MIDFLORIDA FCU was seeking. It just so happened that years ago, Hernandez and Jones were neighbors. Hernandez approached Jones about a year ago about the possibility of a partnership and the rest is history. A.H. Realty's strong selling points included a solid management structure and team, the ability to "scale up" and a member-centric culture that mirrored MIDFLORIDA FCU's model, Jones noted. It didn't hurt that the realty company at one point was doing 1,000 transactions a year before the market downturn."We noticed our most profitable [member] is our mortgage [member]," Jones said. "We thought when CUSO powers were expanded to allow real estate brokerage services, it would be a good time to enter. We entered but in a small way to get our feet wet and to make sure we were doing it right."Hernandez said the acquisition makes perfect sense for those looking for all their mortgage needs under one roof."We know how to sell houses," said Hernandez, a 29-year real estate veteran, "but we have not had the capital to build our business. Becoming part of MIDFLORIDA will allow us to create a unique real estate agency that offers a superior experience for both the customer and the realtor."–[email protected]