Three Ways to Establish a Mortgage-Based Relationship

First-time homebuyers have unique needs that can be readily catered to. Consider three tactics to offer value to this growing group.


First-time homebuyers are a valuable, yet vulnerable group of home purchasers: they tend to be younger, they earn less money, and a growing percentage are single.  They understand the benefits of ownership, but their limited knowledge of the real estate process can create anxiety and slow the decision-making process. This anxiety is understandable—after all, buying a home is often the first big decision made using borrowed money.  But a little help delivered the credit union way can enhance their knowledge, boost their confidence, and seal the deal. 

Three Activities That Promote the Credit Union Difference
A three-pronged approach to first-time homebuyers—combining education, service, and value—can be the key to establishing mortgage-based relationships.   

  1. Endorse educational resources. Credit unions should actively promote websites, resources, and tools that are produced by reliable sources and provide cleanly presented, digestible information.  Because first-time buyers tend to be younger, they are Internet-savvy and feel comfortable and may prefer using it as a resource of housing market research.  However, the wealth of information available on the Internet can be daunting.  Credit unions can help by compiling “Reliable Resource” suggestions for distribution to prospective homebuyers to help gain market knowledge.
  2. Invest time in the borrower.  The proliferation of new (and riskier) mortgage products over the past few years could confuse even seasoned buyers.  As first-time homebuyers increase their knowledge of the homebuying process and the real estate market, they can also benefit from clear explanations and side-by-side comparisons of the different mortgage products.  Significant time should be spent educating borrowers on the inherent benefits and risks of each mortgage type, the range of possible future payment changes, and financial impact of those changes on the borrower’s financial health.
  3. Provide visible cost savings.  Tangible value—real money—can create a strong incentive for first-timers.  Many credit unions have formed partnerships with CUSOS like CU Realty that pair agents who have agreed to a reduced commission with new homebuyers.  Some partnerships offer rebates at the time of purchase; others will waive certain fees or pass along savings for future home good purchases.  First-time homebuyers particularly value these savings.


    Recent housing price corrections mark a transition from a seller’s market into more of a buyer’s market.  This shift can add to a first-timer’s uncertainty, but it also creates new opportunity.  The three tactics above can help put first-time homebuyers at ease in an unpredictable market as well as enhance the homebuying experience through long-term satisfaction – the credit union way.

    To learn about other effective strategies to reach and educate this segment, join us for our upcoming webinar, “Opening Doors for First-Time Homebuyers,” brought to you by Callahan & Associates.




Nov. 13, 2006


  • Could be that first time buyers will be a bigger part of the market as sales cool and fewer current owners trade up, so it makes sense to have a specific strategy for that segment. I do wonder, however, how the first timer differs from repeaters in terms of risk, if at all. Any CUs that have seen higher delinquencies from first time buyers?
  • Excellent article!