Home Loans, Microloans, And Exam Prep

Five can't-miss data points this week on CreditUnions.com.

From microloans to exam prep, this week, CreditUnions.com is focused on all things lending.

Here are five can’t-miss data points:


Lake Trust Credit Union dove into member business lending not long after its creation through a merger of equals in 2010. Since then, the cooperative has built a healthy MBL portfolio and expanded its business services into checking, treasury services, credit cards, and commercial real estate lending. In 2017, the cooperative became the first credit union to be named Michigan lender of the year by the Small Business Administration. Despite the array of services, leaders at the credit union which serves southeast and central Michigan thought something was missing. So, in 2019, Lake Trust moved into microlending, providing small loans and guidance to entrepreneurs who might otherwise risk their personal credit or simply stay on the sidelines. Using a CDFI grant of $975,000 to bolster reserves, Lake Trust has made approximately 50 microloans that average $20,000 to $25,000 each.

Read more: Lake Trust Builds Big Dreams With Microloans


SC Telco Federal Credit Union participated in its first Habitat for Humanity home build in 2013, and the cooperative has built on its record of housing service in its hometown market ever since. Today, the credit union provides volunteer labor and participates in Habitat leadership and fundraising efforts. It also lends money directly to the new homeowners. The credit union currently holds 51 loans that originated through the Habitat relationship. Those loans comprise $2.7 million in a first mortgage portfolio of 1,070 loans totaling $122.0 million.

Read: A Credit Union Home For Habitat Homebuilding

12.9 Million

The Federal Financial Institutions Examination Council (FFIEC) in September released HMDA data for 5,683 U.S. financial institutions on 12.9 million home loan applications in 2018. The report includes 48 data points, including many new ones, that help financial institutions, governments, mortgage experts, and more assess loan practices related to ethnicity, race, sex, and age of borrowers. NCUA regulators use the HMDA data set to determine which federal credit unions might require fair lending exams and off-site supervision contacts over the next year. According to credit union lenders, a sharper focus on a variety of factors including data quality, fair lending management, and outside vendors can go a long way toward avoiding the headaches of an NCUA exam. Here are eight tips and best practices to help credit unions adhere to fair lending guidelines.

Read: 8 Avenues To Avoid A Fair Lending Exam

$440 Billion

First mortgages totaled $81.6 billion and represented more than 26.0% of all loans at credit unions in the second quarter of 2000. As of June 30, 2019, they totaled more than $440 billion and represented 41.1% of the loan portfolio. That’s an increase of over 15.0 percentage points. What might happen to a credit union’s loan portfolio if economic conditions in the United States shifted abruptly? Callahan & Associates is not in the business of predicting recessions; however, the firm can help credit unions determine whether the loans they have on the books or are planning to make are good for individual members as well as the overall membership. One way to do that is by looking at asset quality, how credit unions are hedging for the future, and where the U.S. economy is heading.

Read: Are Your Loans Good For Members?

2 Percentage Points

Pen Air Federal Credit Union has captured the loyalty of thousands of members in the three years since it rolled out an auto finance recapture program that knocks up to 2 percentage points off loans brought in from another lender. The program began in mid-2016 and is highlighted twice a year with marketing campaigns that use internal data to identify loans held elsewhere that might be attracted instead to the Panhandle cooperative. The inspiration for the strategy arose from the realization that a lot of A paper was already coming in from indirect lending, and that something was missing.

Read: Pen Air Recaptures Its Way To Auto Loan Growth

Happy Reading!

November 4, 2019

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