Most credit union customers don't realize that when applying for a mortgage, it is not the credit union who will actually be servicing their loan. This may not be the case depending on the credit union you are using, but the majority of the time you will find that it is not the credit union that will be handling the mortgage you are applying for.
While local consumers expect that their mortgage will be serviced by their credit union, they will soon find out that the loan is actually "farmed out" to a mortgage lender that is not part of the credit union, but only services mortgages for them. In rare cases where a credit union will handle their own mortgages, to qualify will likely be very difficult. You will most likely need perfect credit and a substantial down payment. The risk involved in high balance loans is why these credit unions use secondary lenders. This way, they can still seem like they are providing a service to you, but they don't have to worry about taking the loss should the loan go into default.
Consumers looking for a VA or FHA loan will rarely find these mortgages available though their credit union. Freddia and Fannie Mae conventional mortgages will likely be an option, but again, depending on the credit union you belong to, these mortgages are not likely to be serviced directly by your credit union. The loan will actually come from a wholesale lender who is merely passing on their products and rates to the credit union. Payments will also be made to the wholesale lender and not directly to the credit union, which is not what most people taking out these loans expect, and in turn are not pleased by this fact when they find out what is actually going on.
While going through the mortgage approval process, consumers should be made aware that they are actually dealing with a representative of the mortgage lender, and not necessarily one from their credit union. This is to protect the credit union from the liability of customer complaints and other responsibilities related to the loan, but is not always disclosed to the customer.
This is a far cry from the image of the credit union portrayed in the movie "It's A Wonderful Life". While the kindly George Bailey may have provided a a sincere, dedicated service to his mortgage customers, these days this is more of a fantasy than a reality. In the real world it is more like George partnering with Mr. Potter and feeding his clients to him so he can devilishly take advantage of these good people during the home financing process and have them paying unexpected overcharges for his services. While you may be lucky enough to have a credit union that services their own mortgages, the chances of that are slim.
When the money coming in from the mortgages your credit union is sending to their secondary lenders becomes substantial, it is likely that they will start not to care about what happens to that customer after they are no longer involved in the loan process. This is something that every consumer using a credit union to secure a mortgage should think about before they accept the loan.
While local consumers expect that their mortgage will be serviced by their credit union, they will soon find out that the loan is actually "farmed out" to a mortgage lender that is not part of the credit union, but only services mortgages for them. In rare cases where a credit union will handle their own mortgages, to qualify will likely be very difficult. You will most likely need perfect credit and a substantial down payment. The risk involved in high balance loans is why these credit unions use secondary lenders. This way, they can still seem like they are providing a service to you, but they don't have to worry about taking the loss should the loan go into default.
Consumers looking for a VA or FHA loan will rarely find these mortgages available though their credit union. Freddia and Fannie Mae conventional mortgages will likely be an option, but again, depending on the credit union you belong to, these mortgages are not likely to be serviced directly by your credit union. The loan will actually come from a wholesale lender who is merely passing on their products and rates to the credit union. Payments will also be made to the wholesale lender and not directly to the credit union, which is not what most people taking out these loans expect, and in turn are not pleased by this fact when they find out what is actually going on.
While going through the mortgage approval process, consumers should be made aware that they are actually dealing with a representative of the mortgage lender, and not necessarily one from their credit union. This is to protect the credit union from the liability of customer complaints and other responsibilities related to the loan, but is not always disclosed to the customer.
This is a far cry from the image of the credit union portrayed in the movie "It's A Wonderful Life". While the kindly George Bailey may have provided a a sincere, dedicated service to his mortgage customers, these days this is more of a fantasy than a reality. In the real world it is more like George partnering with Mr. Potter and feeding his clients to him so he can devilishly take advantage of these good people during the home financing process and have them paying unexpected overcharges for his services. While you may be lucky enough to have a credit union that services their own mortgages, the chances of that are slim.
When the money coming in from the mortgages your credit union is sending to their secondary lenders becomes substantial, it is likely that they will start not to care about what happens to that customer after they are no longer involved in the loan process. This is something that every consumer using a credit union to secure a mortgage should think about before they accept the loan.
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