Shelter from the Mortgage Storm? Try Your Credit Union

Close Encounters of the Cheap Kind has a new home at www.CheapEncounters.com!

Unless you’ve been living under a rock for the last few weeks, you are probably very aware by now of the issues around mortgage lending. If not, go take a look at your brokerage account and try to come up with another explanation the balance number is so much lower than it was before. As painful as it is for those of us who are investors, it is probably even worse for those who are trying to get a mortgage in this hostile environment.

So what’s a buyer to do to take shelter from this mortgage storm? Apparently, the answer is to head down to the credit union. According to this Marketwatch article, borrowers are turning to credit unions to get mortgage loans after encountering difficulties borrowing from banks and other lenders. Why? Because most credit unions hold their mortgage loans in their own portfolios rather than trying to sell them in the secondary market. That means they don’t really have to care if they can resell the loan or if it meets investment grade standards.

Although it may vary, credit unions often provide better loan rates and deposit products with fewer fees since they are non-profit organizations. There are disadvantages, but for savvy consumers credit unions are typically great places to do business. And membership restrictions have loosened at many credit unions in the last several years, meaning it is easier than ever to qualify for membership. Check out the Credit Union locator for a credit union in your area.


August 28, 2007 - Posted by | Debt, Home Ownership

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