As a result of the rising interest rate environment over the past
two months, mortgage refinancing volume has declined over 75% according
to the Mortgage Bankers Association. With first mortgage lending
and refinancings being the leading driver of credit union loan growth
over the past two years, credit unions will need to begin to examine
alternatives to long-term fixed rate mortgage products for members
in order to sustain the strong loan growth in the business.
Some credit unions are now increasing their focus on adjustable
1st rate mortgages, a product that is more appealing to members
because of its lower monthly payments. With consumers changing homes
every seven years on average, the product is a better fit for members.
Adjustable mortgages are beneficial to an asset liability management
standpoint since it removes a long-term fixed rate asset from the
balance sheet- particularly important in the current low interest
Below is a list of the top 25 credit union lenders in adjustable
1st rate mortgage originations. Nationally, adjustable rate mortgage
originations have represented approximately 15% of all mortgage
originations in 2003. These 25 leaders are well above average not
only because of their size, but also because of an increased focus
on the product. With percentages over four times the national average,
the top four credit unions show that focusing on this product is
benefiting both the credit union and the member.