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Inside Washington (10/24/2008)

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* WASHINGTON (10/27/08)--National Credit Union Administration (NCUA) Chairman Michael E. Fryzel visited Acceso FCU in Washington, D.C., Wednesday in conjunction with Hispanic Heritage Month. Acceso FCU is a joint project among IDB-IIC FCU, District Government Employees FCU, and OAS Staff FCU designed to improve access to credit union services in a primarily Hispanic part of Washington, D.C. “Acceso is a working example of how credit unions can and do make a difference in their communities,” Fryzel said. “The branch has not only effectively targeted the needs of its Hispanic membership through bilingual outreach and wire transfer services tailored to that community, but it is also an important physical presence in an area badly in need of traditional financial service providers.” From left are: Fryzel, Acceso CEO Carla Decker, and Branch Manager Ana Maria Roig. (Photo provided by the National Credit Union Administration) ...

CUNA details Hope for Homeowners program

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WASHINGTON (10/27/08)—The Credit Union National Association (CUNA) has issued a final rule analysis on the Federal Housing Administration’s (FHA’s) Hope for Homeowners (H4H) Program to refinance up to $300 billion in troubled, subprime mortgages into fixed-rate, FHA-backed loans. The H4H program is voluntary and all lienholders must agree to participate, including any subordinated lienholders who may hold home equity or other similar type loans. The program also allows the subordinated lienholders to share in any future appreciation of the property as a means to encourage them to participate in the program. Under this program, effective for loans originated on or before Jan. 1, 2008, eligible homeowners will be able to refinance their subprime, primary residence home loans. To qualify, the lender or mortgage investor must reduce the loan principal and would receive a guarantee for no more than 90% of the home's current appraised value. In addition, the lender would have to pay a 3% FHA loan origination fee. In exchange for an FHA guarantee on the mortgage, borrowers must share with the FHA the newly created equity and any future appreciation from the resale of the refinanced home. The program became effective as of Oct. 1. For more details, use the resource link below to read CUNA’s complete rule analysis.

Compliance Can CUs give Hope 4 Homeowners loans

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WASHINGTON (10/27/08)--The Federal Housing Administration’s (FHA’s) new Hope for Homeowners (H4H) Program lets lenders refinance certain delinquent mortgages to help borrowers hang onto their homes. But what lenders are eligible to participate? Are credit unions among them? In its October Compliance Challenge, the Credit Union National Association (CUNA) advises credit unions regarding who is an eligible lender, as well as who is an eligible borrower. All FHA-approved lenders are allowed to originate mortgages under the temporary H4H program--so credit unions that offer FHA loans are qualified. All lender participation is voluntary. The program was created by the Housing and Economic Recovery Act of 2008, signed into law in July. The H4H website lists 78 lenders that have been cleared to participate in the program. It has also been reported that the FHA is fielding roughly 1,000 calls a day from interested borrowers. Under the program, certain borrowers facing difficulty in paying their mortgages will be eligible to refinance into a 30-year fixed rate FHA-insured mortgage. The H4H Program is effective for endorsements on or after Oct. 1, 2008 through Sept. 30, 2011. CUNA notes that borrowers may be eligible if, among other factors:
* The home is their primary residence, and they have no ownership interest in any other residential property, such as second homes; * Their existing mortgage was originated on or before January 1, 2008, and they have made at least six payments; * They are not able to pay their existing mortgage without help; * As of March 2008, their total monthly mortgage payments due were more than 31% of their gross monthly income; and * They certify they have not been convicted of fraud in the past 10 years, intentionally defaulted on debts, and did not knowingly or willingly provide material false information to obtain their existing mortgage(s); * The loan amount may not exceed a maximum of $550,440; * The holders of existing mortgage liens must waive all prepayment penalties and late payment fees; * The existing first mortgage lender must accept the proceeds of the H4H loan as full settlement of all outstanding indebtedness; * Existing subordinate lenders must release their outstanding mortgage liens; * The borrower must agree to share with FHA both the equity created at the beginning of this new mortgage and any future appreciation in the value of the home; and *The borrower cannot take out a second mortgage for the first five years of the loan, except under certain circumstances for emergency repairs.
Use the resource links below for more detailed information on the new program.

CUNA league pull out stops for CU champion

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Click to view larger image CUNA Senior Vice President of Political Affairs Richard Gose (right) discusses with Rep. Paul Kanjorski (D-Pa.) the elections during Gose's visit to Kanjorski's campaign in his district in Pennsylvania this week. Gose spoke to credit unions about Kanjorski, a long-time credit union champion. This was the third trip CUNA staff have made to the district during the campaign. (Photo provided by Penn. Credit Union Association)
WASHINGTON (10/27/08)--The Credit Union National Association (CUNA), Pennsylvania Credit Union Association (PCUA) and credit unions from around the country continue efforts to boost credit union champion Paul Kanjorski’s (D-Pa.) reelection bid. The 12-term congressman is in an extremely tight race against challenger Lou Barletta, the mayor of Hazleton, Pa. Kanjorski is a staunch supporter of credit union legislative initiatives in Washington. He was the original sponsor of the Credit Union Regulatory Improvements Act (CURIA, H.R. 1537), the Credit Union Membership Access Act (H.R. 1151) and the Credit Union, Bank and Thrift Regulatory Relief Act (CUBTRRA, H.R. 5519). Kanjorski also chairs the House Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises. In addition to ongoing fundraising activities, the credit union groups have boots on the ground in Kanjorski’s district. Their goal is to educate and mobilize the most likely pro-Kanjorski voters among the approximately 117,000 credit union members who reside there, according to the PCUA. Among the tactics employed by credit unions in support of Kanjorksi: Face-to-face constituent meetings and open houses with Kanjorski, voter canvassing, and direct mail. All of these activities were directed at credit union members. PCUA also hosted an Oct. 20 "thank you" party for credit union members who so far assisted with this campaign.