With the historically low mortgage rates of 2012 carrying into 2013, now is an ideal time to move forward with refinancing your mortgage. While rates are projected to remain low for at least the first part of the year, they have nowhere else to go but up from this point. However, if you act now, once the housing market does begin recovering and rates do begin rising, you won’t find yourself with refi regrets.
Credit Unions “Know Their Borrower”
The opportunity to take advantage of near record low mortgage rates is here, and credit union members should take heed. As a credit union member in the market to refinance, you’re in an even better position than the average bank customer. In addition to the current super-low rates, credit unions offer superior member service and the kind of personal attention that consumers are just not likely to find at a big bank or mortgage broker.
Edward Sweeney, Assistant Vice President, Consumer Loans for Affinity Federal Credit Union (Basking Ridge, NJ) explains how credit unions take pride in knowing their members better than banks. “That knowledge allows us to process applications faster and, more importantly, to make sure that our members borrowing needs are correctly addressed while insuring they are offered the proper mortgage product.”
Likewise, at Space Coast Credit Union (Melbourne, FL), superior processes and services ensure that the credit union not only saves members money, but also saves them time. According to Laura Richard, Vice President of Marketing, SCCU has a fast application process that can be completed online or over the phone, local underwriting, and experienced member service representatives. “Our loan process includes an in-depth interview to ensure the loan closing runs as smoothly as possible, and upon completion, we solicit member feedback on how well we’re doing using the SCCU Members’ Watchdog rating system.” Only members who have used a particular product or service can review it and reviews are available to read on SCCU’s website.
And, at Collins Community Credit Union (Cedar Rapids, IA), their real estate professionals take the time to analyze every borrower’s scenario. “Our loan officers are experts in determining which options are best for each borrower,” says Sarah Whittle, Real Estate Operations Manager.
CU Members Mortgage, a division of Colonial Savings, offers refinance loans to credit union members across the country by partnering with over 1,000 credit unions. The company’s VP of Direct Lending, Matthew Abbink, believes that first and foremost, the credit union is a trusted financial partner. “As a cooperative, each member has a share of ownership in the credit union -- wouldn’t you rather finance your biggest financial investment with someone you know and trust?” Abbink adds that credit unions have historically offered lower rates and lower fees for all financial products so financing a home through one’s credit union simply seems like the smarter choice.
Credit Unions Offering Low Rates, Low Fees, and Local Service
Along with historically low rates, many credit unions are offering special refinancing programs and options for new and existing members, and doing so with the guidance, care, and service that credit union members have grown to expect.
Affinity has a wide variety of loan choices from traditional fixed-rate to non-traditional adjustable rate mortgages (such as their new 5/5 ARM) with competitive rates and low closing costs. The 30-year fixed rate mortgage is currently 3.50% APR with 0 points.
Likewise, Space Coast mortgages offer competitive rates and fees, no intangible tax, no early payment penalties, and lower pricing on Private Mortgage Insurance – which all equate to direct savings for their members. Additionally, SCCU offers a Member Rewards Program with added incentives, including discounts on mortgage processing fees, based on the member’s relationship with SCCU.
SCCU also offers the Home Affordable Refinance Program (HARP), which assists members who were previously unable to qualify for a refinance because the value of their home had declined. “As a result of HARP, SCCU was able to assist over 300 struggling homeowners by refinancing more than $55 million in HARP mortgages,” explains Richard.
Mountain America Credit Union (West Jordan, UT) also offers a full range of products for both refinances and purchases. According to Amy Moser, VP of Mortgage Services, rates have been ranging from 3.25% on a 30-year fixed to 2.625% on a 15-year mortgage. “Anytime you can reduce your interest rate by .50 or higher it will ultimately save you on the overall interest for the life of the loan.”
CU Members Mortgage reports that although rates can vary depending on different factors, 30 year fixed rate loans are currently in the low-3% range with 15 year fixed rate loans currently in the mid-high-2% range. “Members benefit from record low interest rates, closing costs that are typically less than non-credit union competition, they receive the level of service expected from credit union members, and they can trust their loan will not be sold to an unknown entity,” contends Abbink.
At Lake Michigan Credit Union (Grand Rapids, MI), about 55% of all current mortgage applications are for refinancing. Although the credit union’s 30 year fixed rate is at about 3.5% with zero points, Eric Burgoon, Senior Mortgage Executive, urges members to consider shortening the term of their mortgage to a 15 year fixed with a rate at about 2.75% because they may find their payment will remain about the same as with their current mortgage. Burgoon says that credit unions can generally offer lower rates and lower fees, saving them money (long-term and up-front cash) and allowing them to break-even on their refinance faster.
Abbink advises members that the New Year is a great time to re-evaluate one’s future financial goals. “Whether it’s refinancing to lower one’s interest rate, to obtain cash for debt consolidation or for home improvements, or if it’s to plan for a future home purchase, the time could not be better to speak with an experienced and knowledgeable credit union mortgage professional.”
If you want to celebrate the arrival of 2013 by taking advantage of a low rate mortgage refi, contact your credit union’s lending department for details or to apply. Not a credit union member? Find a credit union and join today! Happy New Year and happy refinancing!