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CDCU Mortgage Center aids New Orleans revival
NEW YORK (8/21/08)--A pilot program developed by ASI FCU, New Orleans, and the National Federation of Community Development Credit Unions has helped several New Orleans homeowners refinance their mortgage loans. One homeowner, “Helen,” was struggling to make her loan payments before Hurricane Katrina hit in 2005. Her interest rate jumped to 14% from 9%, and because she had made late payments, she was unable to refinance. Helen received help from the federation’s Community Development Credit Union (CDCU) Mortgage Center, which provided funds to ASI FCU to purchase the loan it refinanced to Helen. With a new rate of 6.125%, Helen’s monthly payment dropped by $724. Another ASI member, “Belinda,” also was struggling to make her payments. Belinda had taken out a home equity loan to pay for surgery. With a 14.75% interest rate, her monthly payments surpassed $1,000. With the ASI and the federation’s program, Belinda refinanced her loan at a new rate of 6.125%. Like Helen, her monthly payment dropped by $724. “It’s so very important to stabilize our population in New Orleans,” said Mignhon Tourne, ASI CEO. Credit unions have helped thousands of members rebuild, she added. The CDCU Mortgage Center was created to help CDCUs expand their affordable-mortgage lending programs to low-income people by purchasing CDCU loans. “We definitely see possibilities to expand this pilot program,” Tourne said. “People come to us with high-priced loans from finance companies and brokers, even without us advertising or marketing the program.” Contributors to the program include the John D. and Catherine T. MacArthur Foundation, the National Credit Union Foundation and the Jewish Funds for Justice.
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