The Big and the Bold

Mortgages are an exciting component of the credit union loan portfolio. These four CUSOs enter the industry from different access points.


Rules, regulations, and the dreams of regular people. In order to succeed in the mortgage business, credit unions must be able to navigate a dense, intimidating environment. Luckily, a CUSO can point a credit union and its members in the right direction.

As entities designed to provide services for credit unions, CUSOs offer an array of characteristics for credit unions’ disposal. No single attribute creates a perfect fit, but Tower Title Services, CU Realty Services, Prime Alliance, and myCUmortgage are four examples of the different ways in which CUSOs help credit unions access the real estate world.

Tower Title Services
Maryland-based Tower Title Services is a small CUSO that serves its parent credit union, Tower Federal Credit Union (Laurel, MD, $2.2B), as well as six others. It offers title insurance and real estate settlements to real estate buyers and sellers. And it does so with fewer than 10 employees. 

“The real estate loan is a product, but it’s really more of a service,” says Barry Stricklin, manager of real estate lending at Tower Federal Credit Union. When considering how to supplement TFCU’s real estate portfolio, Stricklin and his colleagues examined the industry to locate areas in which he thought they could deliver service and value to members. Title services popped into view.

But before diving in, Stricklin and his colleagues did their research. They looked at liabilities.

They looked at pro forma financials. They looked at how scalable a title program would be. Once they decided their plan was doable, they launched Tower Title Services as a wholly-owned CUSO, which allowed them offer their services to other credit unions.

Having an experienced leader on board early was critical, Stricklin says, and today, a real estate attorney manages Tower Title. Stricklin encourages any credit union that wants to start a company such as Tower Title to zero in on experience when evaluating potential hires. The expertise will add immediate credibility to the company and help in early negotiations with people such as underwriters.

Stricklin says the goodwill between Tower Federal Credit Union and its members made opening the title company a viable endeavor. If the employees at Tower Federal Credit Union recommended Tower Title, Stricklin felt like members would listen. He was right.

Tower Title captures 90% of the loans that are originated at TFCU.

“I believe other credit unions can achieve that,” Stricklin says.

Tower Title further guarantees success by offering two value-added propositions. First, convenience. The staff brings the transaction to members whenever and wherever they want at no additional cost beyond the base fee. Second, simplicity. Tower’s fee structure is straightforward, and Tower doesn’t pass costs onto the borrower.

Tower Title might not be the biggest CUSO, but it makes a big impact.

Prime Alliance
With headquarters in Tukwila, WA, and an office in Edina, MN, Prime Alliance operates under two fundamental objectives. The first is to create the best possible borrowing experience for credit union members, says Dan Green, vice president of business development for the CUSO. The second is to create leaner lending practices for credit unions.

Prime Alliance, a one-stop-shop for credit unions in need of lending solutions, achieves these objectives by bringing uniformity and control to the business. It keeps all documents and data related to a mortgage transaction in one computer system, which reduces confusion and errors. The company focuses only on the mortgage transaction and offers support for its solutions.

“We’re in the mortgage lending solutions business,” Green says.

Prime Alliance also offers expertise.

“One of the reasons for our success is our staff is experienced,” Green says.

And all of the methodology and experience is aimed at creating a CUSO that can best serve its members. For Green, a successful CUSO is one that demonstrates a strong value proposition and maintains efficiency.

By encircling the mortgage transaction with its offerings, Prime Alliance shows how a CUSO can reduce the stress on member credit unions that want to enter the mortgage business but lack the resources to do so.

CU Realty Services
Although CU Realty Services does not originate or process mortgages, the California-based CUSO keeps mortgages in the credit union industry by connecting members to a critical component of the mortgage business: agents.

“CU Realty helps credit unions position themselves as a first point of contact with their members before they connect with realtors who direct them elsewhere for their mortgage,” says Tina Powers, chief operating officer for CU Realty Services.

The CUSO tends to 56 credit unions nationwide. One benefit of this wide-reaching coverage is the ability to increase the visibility of a credit union’s mortgage offerings in the hopes of increasing the flow of mortgage services into the industry, Powers says.

Once the process of finding a home begins for a member, CU Realty Services opens up its network of Approved Agents. Working with one of these agents nets the credit union member a 20% rebate and a reliable realtor that has the member’s best interest in mind.

CU Realty Services’ approach to the mortgage industry is an exciting one. It works with three of the major players (finance providers, home buyers, and realtors) and works to benefit them all.

myCUmortgage puts credit unions in the driver’s seat. The CUSO, which is owned and operated by a division of Wright-Patt Credit Union (Fairborn, OH, $1.9B), delivers exactly what a credit union wants during the mortgage process.

Its results are resounding. The Ohio-based CUSO and its credit union partners increased closed loan production by more than 180% from 2008 to 2009.

Knowledge of the industry, expertise for credit unions that already have mortgage departments, and top-shelf pricing and customization all make myCUmortgage an attractive mortgage CUSO option. And even though it works with nearly 120 credit unions, it aims to make each deal more beneficial than the last. myCUmortgage even partners with Prime Alliance for software access. Apparently, great minds think alike.

CUSOs are a viable option for credit unions that want to enter the mortgage business. And there’s no wrong choice when it comes to choosing a CUSO. The bottom line is each credit union must make the decision that best serves members. The size of the CUSO doesn’t matter nor does the number of credit unions it serves.

Tower Title Service offers convenience. Prime Alliance offers efficiency. CU Realty Services offers access. And myCUmortgage offers customization. Each offers much more, too. The only question left for credit unions considering a CUSO is “Which one works best for your members?”