What is meant by an affordable mortgage?
Simply stated, an affordable mortgage offers the borrower(s) a house payment plan they can afford at the time of closing and into the future based on current income and other outstanding debt. Whereas income and future debt can change a borrower’s circumstances and may be out of the control of the mortgage lender, a responsible lender will ensure any future changes in the mortgage payment are manageable under the borrower’s financial picture at the time of closing.
Who needs an affordable mortgage?
All homebuyers deserve an affordable mortgage. But many homebuyers were sucked into unscrupulous mortgage loans during the mortgage bubble, that when popped, turned into unaffordable loans and the risk of foreclosure. In particular, lower income households and 1st time homebuyers were targeted by questionable broker tactics.
Why should credit unions care?
Members and potential members are looking for dependable mortgage loans from financial institutions they can trust. Credit unions, for the most part, avoided questionable subprime lending practices and are in a position to be a trusted lender. But even if credit unions weren’t responsible for making bad subprime loans, many of their members have them and are struggling to keep their homes or are facing foreclosures.
What can credit unions do?
Credit unions can encourage members with subprime loans facing high interest rate adjustments to refinance, if possible, with a credit union loan. If that is not possible, the credit union can help members by restructuring other debt the member has with the credit union. A credit union can also position itself as a trusted advisor and lender to 1st time homebuyers who want to take advantage of the current rate and market environment to purchase a home.
Mortgage Loans Using ITIN's » View details
Latino Community Credit Union was created to provide a safe place for Latinos and the unbanked to keep their money. Members were asking for mortgages as soon as the credit union opened its doors. LCCU designed a mortgage product for 1st time homebuyers, many of whom use ITINs in lieu of SSNs.
Rescue Refinance » View detailsRescue Refinance is designed for any member who is in danger of losing their home to foreclosure.
Mortgage Crisis Loan » View detailsThe Mortgage Crisis Loan has been designed for members with existing CoVantage loans that are struggling with payments, but have sufficient income and are willing to sit down with a loan officer to have loan restructured.
Easy Reverse HELOC » View detailsThe Easy Reverse HELOC is for those members with paid-up mortgages who wish to stay in their homes and receive income from that home for up to 10 years. It has been designed to be a cost-effective and member friendly alternative to standard reverse mortgages.
Subprime Mortgage Refinance & Rescue » View detailsBorrowers in danger of foreclosure as a result of unscrupulous subprime lenders. Many of these borrowers had no mortgages or very low mortgages prior to Katrina, but needed to rebuild post-Katrina and were sold high-priced adjustable rate mortgages (ARMs).
- Helping Members Avoid Foreclosure: A Credit Union Toolkit – National Federation of Community Development Credit Unions
- Income and Tenure of Households Seeking Foreclosure Counseling: A Report from Recent Surveys – National Low Income Housing Coalition
- Interventions in Mortgage Default: Policies and Practices to Prevent Home Loss and Lower Costs – Freddie Mac
- The Credit Union Home Loan Payment Relief (HLPR) Program – Credit Union National Association
- Getting to the Heart of Housing’s Fundamental Question: How Much Can a Family Afford? – National Low Income Housing Coalition
- Putting Home Ownership Back Within Reach – The National Urban League
- Fact Sheet: The State of the Nation’s Housing – Harvard University’s Joint Center for Housing Studies
- Saving Homes, Saving Communities: Latino Brokers Speak Out on Hispanic Homeownership – NAHREP & NCLR Joint Report
- Getting to Scale: New Business Strategies For Homeownership – NeighborWorks® America