CUInsight reports that the economic downturn continues to challenge financial institutions nationwide, but credit unions in Louisiana can take advantage of the opportunities to expand mortgage lending. This is particularly true among low- and moderate-income populations, says Terri J. Fowlkes, Director of Community Development Investments at the National Federation of Community Development Credit Unions. “With interest rates holding steady at rock-bottom levels, credit unions need to diversify their portfolios by continuing to make mortgages and increase their operating income,” Fowlkes stated. “Responsible loans made to qualified members provide credit unions with a much better yield than they’ll get from most other investment vehicles, and helps members build wealth through home ownership.” Fowlkes acknowledged the difficulty many credit unions have in making loans where no secondary markets exist, particularly for non-traditional loans such as Individual Tax Payer Identification Number (ITIN) loans, manufactured housing loans, and coop loans. The Federation and the Louisiana Credit Union League are exploring ways to increase credit union mortgage lending through utilization of the Federation’s CDCU Mortgage Center Secondary Market. “The Federation is the only credit union organization offering secondary (alternative) capital to credit unions nationwide,” Fowlkes stated.
