HIGHTSTOWN, N.J. (12/16/08)--Although New Jersey Credit Unions are "in good shape overall," some likely will participate in a recently announced National Credit Union Administration (NCUA) plan to offer credit union low-interest loans to stave off mortgage foreclosures and spark lending, said the New Jersey Credit Union League.
Any programs that help members stay in their homes will be embraced, said Paul Gentile, league president/CEO (The Record Dec. 12).
The NCUA's CU Homeowners Affordability Relief Program (CU Harp) will allow credit unions to borrow at favorable rates from the Central Liquidity Facility, and receive a 100- basis point spread on the funds if credit unions in return modify a similar amount of at risk mortgages, the Credit Union National Association said. This would be a two-year program, dispensing up to roughly $2 billion.
New Jersey credit unions are not immune to the effects of the U.S. financial crisis and recession, John Fenton, president of the $1.8 billion asset, Basking Ridge, N.J.-based Affinity CU, told the newspaper.
Although the credit union's mortgage portfolio has no problems, the credit union is beginning to see some members falling behind on mortgage payments, he added.
Affinity's philosophy is that it doesn't want to own foreclosed homes, Fenton told the paper. However, he said he wants to learn more about the program before deciding if Affinity will participate.
courtesy of cuna.org