Getting Homeownership within Reach for Your Credit Union Members

Homeownership for MembersDesigning Spaces™ airing on the Lifetime® Channel recently featured an educational segment about making the path to homeownership easier. During the episode, the desire for homeownership and the financial hurdles faced by a millennial couple were highlighted.

Debi Marie, the host of the show, interviewed Matt Young, Senior VP of Sales with Genworth Mortgage Insurance Corporation about private mortgage insurance (PMI), which could be a perfect fit for members of your credit union who are facing similar questions and challenges.

Watch the segment
“Mortgage Insurance and Buying Your First Home – Designing Spaces”

Here are some key points from Debi’s interview with Matt:

Removing the 20% Down Barrier for Potential Homebuyers

Any homeowner knows that accumulating the 20% down for their first home is often one of the biggest financial challenges of their lives. By using PMI, your prospective member homebuyers can purchase a home without having to accumulate the full 20% down payment. This is a big deal since this option can shave years off of the saving process, allowing your members to become homeowners sooner.

During this episode, Matt provides some helpful and specific examples about what payments for PMI would be given your members credit worthiness, down payment amount, and the cost of their targeted home.

Managing Risk with Private Mortgage Insurance (PMI)

As you know, loans with down payments less 20% are typically viewed as riskier loans. With PMI, a down payment as small as 3% is allowable. PMI protects lenders, like your credit union, against loss if a member defaults, making lenders more comfortable with making a loan.

Borrowers are required to pay premiums ONLY until they build sufficient equity in their home, which is typically when they reach 80% loan-to-value (LTV).  PMI is cancellable vs. FHA insurance which remains throughout the life of the loan. This can translate into thousands of dollars in savings for your member over the long-term.

“As we all know, first-time homebuyers often don’t know what their mortgage options are, and it could cost them,” said Matt. “It’s important for us to proactively educate borrowers on the benefits of MI.”

Defraying Costs and Risks of Homeownership

After answering questions about how mortgage insurance works and how it makes some loans possible during this episode, Matt also explained how Genworth Mortgage Insurance provides beneficial online tools for potential member home buyers: a revamped free online Homebuyer Education training course and Homebuyer Privileges®, a discounts program.

Homebuyer Privileges – A program that can help to boost your originations and build member loyalty. The program offers your members discounts and rebates—valued up to $3,500—on the things they need most for their new home. And, best of all, there’s no cost to participate.

Homebuyer Education Online Course (free resource) – An Educated member makes for a better homeowner and decreases the chance of member delinquencies. Through Genworth’s free self-paced online course, members will learn about the home loan process, tips on how to save for mortgage payments, home maintenance planning, and how you can help them along the way.

We’ll be posting more about helping your current and future member homebuyers in the near future; so stay tuned!

Good to CU Genworth Logo
For more educational resources and information from Genworth, visit Preferred Partner Genworth Mortgage Insurance. Genworth Mortgage Insurance is the NAFCU Services Preferred Partner for Private Mortgage Insurance.

Grow Revenue, Control Costs, and Increase Membership

Grow Revenue, Control Costs, and Increase Membership

How smarter collections activities can help your credit union.

Blog post by Marney MacFadyen, Vice President of Sales, Credit Control, LLC. Marney is a life-long fan and supporter of credit unions. Credit Control is the NAFCU Services Preferred Partner for Consumer and Commercial Loan Recovery Services. http://www.nafcu.org/CreditControl/

One of the most enjoyable aspects of my role as a NAFCU Preferred Partner is that I get to talk to so many credit unions around the country.  Most often, I talk with loan recovery specialists.  They tell me about the Consumer Financial Protection Bureau (CFPB) and how it impacts their ability to do their jobs, or about best practices and benchmarks they have found useful, or how they help their credit union colleagues understand what they do and why it’s so important.  These stories drive everything I do.

For many people, “collections” is a dirty word.  Most have some negative perceptions of the people who work to recover past due loans.  And occasionally, we see an article or news piece spotlighting the misconduct of a rogue collector.  Understandably, many credit unions are concerned when they see news like this, and out of an abundance of caution may be reluctant to collect from their members for fear of negative backlash or legal liability.  As a consumer and commercial loan recovery veteran, I can say with complete confidence that there is a right, just, and helpful way for all credit unions to assist with and recover problem loans.

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Unraveling Qualified Expenses for Coverdell ESAs

Guest post written by Alison Brink, copy writer for the Retirement Services division of Ascensus. Alison researches and writes about various IRA, ESA, and HSA topics for Ascensus’ online and printed publications and education materials.

With students back in school and those glaring tuition bills coming due, many of your Coverdell education savings account (ESA) members may be seeking distributions to help pay (or be reimbursed for) their education expenses. And because a designated beneficiary (the child for whom the ESA is established) does not pay taxes on ESA distributions if the assets are used for qualified education expenses incurred at an eligible education institution, members may have questions about whether their expenses are qualified. While the ESA’s designated beneficiary or responsible individual (often a parent or guardian) ultimately is responsible for determining if education expenses are qualified, they often turn to the ESA administrator with questions.

Eligible Education

ESA assets generally can be used for elementary and secondary education, as well as postsecondary education. Some taxpayers save for postsecondary education through qualified tuition programs, commonly referred to as “529 plans.” But 529 plan assets cannot be used for elementary or secondary education.

Eligible Education Institutions

Part of what makes qualified education expenses qualified is the fact that the expenses have to be incurred at an eligible education institution. An eligible elementary or secondary school for ESA purposes is any public, private, or religious school that provides elementary and secondary education (kindergarten through grade 12) as determined under state law. An eligible postsecondary school is any college, university, vocational school, or other postsecondary educational institution that is eligible to participate in student aid programs administered by the Department of Education. An eligible educational institution would include nearly all accredited public, nonprofit, and private postsecondary institutions.

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