Another ominous sign for credit union mortgage lending?

According to a new forecast from Freddie Mac, purchase mortgages will account for 79% of originations in 2015. Is that an ominous sign for the future of Credit Union Mortgage Lending?

In 2012, the purchase share was only 30%. That’s a big swing. We’re already feeling the change in the market as we transition from a refinance boom to a purchase market.

Since Credit Unions usually excel at the refinance market and do not so well at purchases, can we be memberlicious in an environment where 4 of every 5 loans closed purchases?

How big could this impact be? I say REALLY BIG!

Let’s say that your Credit Union did 100 loans in 2012. Based on these numbers, if you were average, you did 30 purchases and 70 refinances.

If your purchase numbers don’t change, and your 30 purchases now account for 79% of your business, you will close 38 loans. In other words, 62 refinances loans will be gone.

That’s a lot of business.

If your purchase numbers don’t change, and your 30 purchases now account for 79% of your business, you will close 38 loans. In other words, 62 refinances loans will be gone.

That’s a lot of business.

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