The mortgage loan benefits of credit unions

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While the big bank corporations continue to lumber along with their mantra of "too big to fail" and complaining about the lagging national economy, it's the small community lenders and credit unions that are making efforts to provide mortgage opportunities to the average family buying a home. As a result, these local and community institutions are now representing the best possibility for a home buyer to be approved for a mortgage loan, especially first-time purchasers.

Focused on local service

Credit unions are designed and established to serve and financially help a specific local community group. As a result, many were original established for specific trades or employee groups. However, since those early years in the 1970s and 1980s, many of the same institutions now enjoy looser banking regulations, allowing them to compete directly against banks for the same customer markets. As a result, many can apply to become a member of a credit union in their area without having to be part of the original charter group served.

 

Better positioned to lend

Because credit unions are more conservative in practice than banks, they didn't suffer nearly as bad during the 2008 economic crisis and real estate meltdown. In fact, many credit unions still have many of their mortgage issued during those times alive and well today, still being paid timely. This means that these institutions have far healthier portfolios on their balance sheets and can still generally lend to new customers. They are not burdened by the toxic loans and foreclosure many of the big banks still have on their books.

 

Favor goes to existing members

The above said, credit unions don't just lend to anyone. They tend to favor members who already have accounts with them including checking accounts, savings, CDs, retirement and similar. Where a credit union sees a member is established and a long-term customer, the institution will go out of its way to help on internal loans to that member. Granted, such applicants still have to have a good credit history and rating, and be timely on any other loans that may be outstanding.

 

Better interest rates

Additionally, many credit unions tend to offer lending interest rates that are usually better than what big bank branches offer in the same community. This critical difference can save borrowers approved by their credit union dozens of thousands of dollars over the lifetime of a conventional mortgage.

 

In summary

Where possible, every consumer in the New York-New Jersey area should sign up with New Jersey credit unions, even if just with a simple savings account. By establishing a relationship as a member, a borrower can then take advantage of the services and loan benefits of a given credit union, finding far more reception a loan application versus what the post-real estate crash big banks respond with today.

About the author: Derek is an active finance blogger. He enjoys giving people advice on their financial issues and also doing taxes for multiple people. The article above is for new jersey credit unions.

Lowering your mortgage costs in an urban setting

By Ken Myers

Lowering your mortgage costs in an urban setting can be tricky, but it is not impossible. While people who live in rural areas are often able to lower costs through selling parcels of land or converting their land into farmland, people who live in an urban setting rarely have these options. Fortunately, there are ways to lower mortgage costs.

1. Refinance your home. If you currently owe less on your home that your house is worth on the open market, it is a great time to refinance. With interest rates at historic lows, it’s possible to save hundreds of dollars a month by refinancing your mortgage. You may also have the option to pull some of your equity out of your home and use it to pay off debt or finance home improvements. Other people choose to stretch out the term of their loan. While this may increase the total amount you pay over the life of the loan, it will reduce your monthly mortgage expense.

2. Reevaluate your taxes. With home values changing so much in many urban areas, it makes sense to spend a few minutes reevaluating your tax statement. Since most people pay property taxes each month as part of their mortgage, a sudden increase in the estimated value of your home could cost you hundreds of dollars a month. If your estimated value looks high, call your local tax collector to find out the reason why. If you don’t agree with the reason, challenge the amount and have your tax bill reduced.

3. Reevaluate your insurance needs. Insurance companies have made a lot of changes over the past several years in response to a predicted larger threat of damage from hurricanes. A lot of insurance companies have also added extra coverage and charged accordingly. If you’re looking to save money, however, it may be time to cut extra coverages, eliminate coverage for items you no longer have, and/or increase your deductible. It may also be possible to qualify for discounts based on the condition of your home or things such as having a security system installed. 

4. Look into an EEM. The government’s Energy Star program offers grants and discounted mortgage rates to homeowners who are willing to install energy saving measures into their homes. Look into this program to see if you qualify.

5. Rent out your space. In many cities, housing and even small office space is considered a very valuable commodity. Consider renting out part of your home or apartment to a temporary roommate or even as office space. 

Author Byline:

Ken Myers as an Expert Advisor on multiple household help issues to many Organizations and groups, and is a mentor for other “Mom-preneurs” seeking guidance. He is a regular contributor of “www.gonannies.com/”. You can get in touch with him at kmyers.ceo@gmail.com.