Mortgage success through member education

first_img ShareShareSharePrintMailGooglePinterestDiggRedditStumbleuponDeliciousBufferTumblr Credit unions can win over banks in this Nicole HamiltonCredit unions have a unique opportunity to capture new members and market share around home ownership, and a distinct competitive advantage over other institutions to do so.Americans have much of their money in their homes. In fact, 80 percent of home owners have 66 percent of their net worth in the equity on their house, according to the Century Foundation’s white paper: A Tale of Two Recoveries. This makes their home by far their largest investment.Yet the statistics on how much people understand about mortgage concepts are grim. Mortgages are complex, but are often sold simply, with the focus on interest rate and monthly payment. In addition, few home buyers are aware of how much equity they might have in their homes in the future, given different available products and offers, or what the trade-offs are with regard to overall cost of the loan.Mortgage originators need to be concerned with ability to pay, and the qualification standards are high these days, preventing precarious financial commitments that many homeowners found themselves in during the pre-mortgage crash. Banks that originate mortgages are generally focused on mortgage origination volume, and keeping their complaints and production costs down, but not necessarily on creating educated customers or optimizing those customers’ long-term financial outcomes well into the future. continue reading »last_img read more