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CU System briefs (05/12/2008)

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* PHOENIX (5/13/08)--Arizona State CU has been ranked as the No. 1 credit union in the state for the second consecutive year in the 2008 edition of Ranking Arizona: The Best of Arizona Business. The book is published by Arizona Business Magazine annually, and its rankings are based on the largest opinion poll in the state. More than 250 business and leisure categories are included. According to David E. Doss, president/CEO of the $1.2 billion asset credit union, 2007 saw the credit union create new products, expand member service and move into a new corporate headquarters. "All across the state, members saw more convenient and expanded banking services with offices staying open later during the week and in many locations providing convenient Saturday banking hours," he said … * SALT LAKE CITY (5/13/08)--Deseret First CU has been recognized by the U.S. Small Business Administration (SBA) as the top medium-sized lender in Utah for SBA-guaranteed business loans. The credit union was ranked first in the category of financial institutions in the state with assets between $100 million and $1 billion. Deseret First CU has $418.6 million in assets and is based in Salt Lake City (PR News Wire and UtahBusiness.com May 12 …

Michigan mortgage summit emphasizes education

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NORTHVILLE TOWNSHIP, Mich. (5/13/08)--The Michigan Credit Union League (MCUL) Mortgage Lending Summit May 2 emphasized educating troubled borrowers about their options.
A full house of attendees listens to one of the Michigan Credit Union League Mortgage Lending Summit presentations May 2. (Photo provided by the Michigan Credit Union League)
The summit included updates from state and federal credit union regulators and agencies, and a panel of mortgage lending and insurance experts (Michigan Monitor May 12). Participants were told that workout assistance is available for borrowers who have difficulty making mortgage payments, and that these borrowers should be urged to consider talking with their credit union before “handing over the keys and walking away.” The goal is to keep even troubled borrowers in their homes, and keep property values from deteriorating, and preventing risk from being shifted to the credit unions, the summit indicated. Presentations highlighted borrower eligibility requirements, income limits, requirements imposed on the buyer and on the property, down-payment programs, homeownership counseling assistance, and access to the programs. “There was a lot of valuable information on the Mortgage Lending Summit agenda,” said Patrick La Pine, MCUL executive vice president. “I think many of the participants were surprised to learn how many programs are offered in today’s marketplace.”

State fee hike may prompt Carfax to leave Missouri

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JEFFERSON CITY, Mo. (5/13/08)--A new fee structure for Missouri motor-vehicle and driver records has Carfax--a company that provides vehicle histories for consumers buying used autos--threatening to stop serving Missouri customers. Missouri's Department of Revenue raised the fee to $7 per record, up from $1.25, and eliminated the bulk discount that Carfax and many other data collection companies, insurance companies, and even media use. The fee hike, which was to pay for the department's new $50 million computer system, amounts to a 460% hike and was effective May 1 (Post-Dispatch May 7). R.L. Polk & Co, Carfax's parent company, has used the title and registration data to compile vehicle history reports for the Carfax service, which is offered in some credit unions. Car buyers pay $30 to use the database for 30 days. The firm said that the increase would mean it would owe the state $42 million more than what it pays for data from all 50 states and Canada combined. Before the fee hike, the cost was less than a quarter of a penny per record, said Tim Sowton, regional director for government relations for the firm. The increase and elimination of the bulk discount is 300,000% more. "We cannot survive absorbing that kind of cost increase," he told the Kansas City Star (May 6). As a result, the company won't update its Missouri data, which means Missourians may not receive notices on automobile recalls, he said. In a hearing on May 6, state lawmakers challenged the agency, saying the hike may violate the Sunshine Law. Rep. Shannon Cooper (R-Clinton) indicated that he would draft a bill to halt the fees and "poke it on every bill out there" as an amendment.

Texas league offers grants to attend Latino conference

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FARMERS BRANCH, Texas (5/13/08)--The Texas Credit Union League (TCUL) is offering grants for Texas credit union professionals and volunteers to attend the Fifth Latino Credit Union Conference June 11-13 in Dallas. The conference affords credit unions the opportunity to learn strategies and techniques for serving their unbanked and underserved markets (LoneStar Leaguer May 7). TCUL accepted grant applications for credit unions in need of financial assistance through last Friday. The grants are made available through the Richard Ensweiler Fund and must be used for the Latino Credit Union Conference. Ensweiler is president of the league. The theme for this year’s conference, “Latinos and Credit Unions: The Crossroads Where Mission Meets Opportunity,” seeks to highlight the potential that the Hispanic market holds for the credit union system. The U.S. Hispanic population increased 1.4 million to reach 45.5 million on July 1, 2007--or 15.1% of the estimated total U.S. population of 301.6 million. The conference is organized by the National Federation of Community Development Credit Unions in collaboration with the Network of Latino Credit Union Professionals. TCUL is one of the sponsors.

CUs lower rates in race for auto loans

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MADISON, Wis. (5/13/08)--Some credit unions are coping with the downturn in the economy by lowering auto lending rates to gain an edge on the competition. Credit unions trying to make auto loans more appealing to members include:
* Pacific Service CU, a $1.107 billion asset, Walnut Creek, Calif.-based credit union, announced it lowered auto rates and simplified its loan program. Qualified borrowers will receive rates of 5.79% annual percentage rate (APR) for terms up to 66 months, and 6.79% APR for terms of 67-84 months. The new rates apply to new and used vehicles, including boats, motorcycles and recreational vehicles. It also is offering a $100 incentive to members to refinance their existing auto loans. * Fidelity FCU, a $30 million asset Sandy Springs, Ga.-based credit union, launched a new auto loan campaign for May, partnering with Enterprise Car Sales to offer loan rates as low as 2.9% on used cars. Fidelity has extended this offer to its members and to anyone who lives, works, worships, volunteers or attends schools in Sandy Springs. * Elevations CU, a $757.9 million asset, Boulder, Colo.-based credit union, last week lowered its best rate on Harley-Davison motorcycles to correspond with the same rate as its automobile loans. Motorcycle purchasers can obtain rates as low as 5.49% with the credit union on Harley-Davidson motorcycle financing. “Because Harleys are a high-ticket item, financing has been a hurdle to ownership for a lot of people. It’s not unusual to see loan rates in excess of 7% on these bikes,” said Craig Burkhard, chief lending officer at Elevations.
During first quarter 2008, credit unions' vehicle loans outstanding declined at a 6% annualized pace, compared with a decline of 2% for the same period a year earlier, says Southwest Corporate Investment Services. Those loans increased less than 1% during all of 2007, Brian Turner, director of advisory services (News Now May 12).

CUSN elects new board

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LAKEWOOD, Colo. (5/13/08)--Credit Union Service Network (CUSN) has announced the results of its Board of Directors election, held during its annual meeting Thursday in Golden, Colo.
Click to view larger image Board members of Credit Union Service Network include, from left: Board Vice Chair Keith Cowling, Credit Union of Denver; Secretary/Treasurer C. Michael Litzau of Sooper CU; Bob Hoefer, Dupaco Community CU; Chairman Carla Hedrick, Denver Community FCU; Stephanie Teubner, Warren FCU; Dave Maus, Public Service CU, Denver; Tom Evers, Premier Members FCU, Boulder, Colo.; and Mark Uden, Mutual lst CU. (Photo provided by Credit Union Service Network)
Incumbents Bob Hoefer, president/CEO of Dupaco Community CU, Dubuque, Iowa, and Keith M. Cowling, president/CEO, Credit Union of Denver, Lakewood, Colo., were re-elected to three-year terms. Newest members of the board include Stephanie Teubner, president/CEO, Warren FCU, Cheyenne, Wyo., and Mark Uden, president/CEO of Mutual lst CU, Omaha, Neb. Teubner was elected to a three-year term while Uden's term will be one year. Officers voted in:
* Chairman, Carla Hedrick, president/CEO of Denver Community FCU; * Vice Chair, Cowling; and * Secretary/treasurer, C. Michael Litzau, executive vice president of corporate at Sooper CU, Denver.
Sixty-four representatives of more than 37 member credit unions attended.

CUs not impacted by tornadoes

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TULSA, Okla. (5/13/08)--No credit unions or credit union members reported damage from tornadoes and storms over the weekend, according to the Oklahoma Credit Union League. Roughly 22 people died when tornados hit Oklahoma and nearby Plains states, and Georgia. Seven deaths were reported in Picher, Okla., and 10 deaths were reported in Seneca, Okla. (USA Today May 12). Neither town has a credit union listed. The U.S. death toll for tornados is this year is at 98--the most in 10 years. The tornadoes follow several other storms that hit Virginia two weeks ago.

Michigan PAC ranks in states Top 25

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PLYMOUTH, Mich. (5/13/08)--The Michigan Credit Union League’s (MCUL) political action committee, ranks 22nd among state political action committees for the 2008 election cycle, the league said this week. The Michigan Credit Union League Action Fund raised $212,851 from January 2007 through mid-April 2008, according to data released by the Michigan Campaign Finance Network. The figure is a 41.3% increase compared with the same time period last year (Michigan Monitor May 12). “Interestingly, more than one-third of the state’s top 150 political action committees are actually down in their fundraising from the previous election cycle,” said MCUL Executive Vice President Patrick La Pine. “This could be a reflection of the state’s weak economy, but it also underscores the remarkable achievement of Michigan credit unions.”

CUs letters debate reasons for conversion attempt

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ODESSA, Texas (5/13/08)--Although a recent attempt by a Texas credit union to convert to a mutual savings bank was dropped, a debate on whether a credit union should convert to a bank still lingers in a public forum in the Odessa American. The latest to weigh in on the issue is a small Odessa, Texas-based credit union. Louise Smith, president of $7.3 million asset Permian Basin CU, wrote the letter in the Odessa American's online forum (May 10). The letter responded to a letter published earlier and written by Shem Culpepper, CEO of First Basin CU. The $115 million asset, Odessa-based credit union had planned to convert to a bank before dropping the proposal after a membership group opposed it. Culpepper's letter noted that the credit union cited "harsh business lending restrictions as one of the key reasons for the need to convert" (Odessa American April 19). The credit union's limit on business loans is $16 million while a mutual savings bank limit is $72 million, he wrote. In her response, Smith said First Basin currently has $5.3 million in business loans and has room to grow. It could triple them before hitting the cap. First Basin grew 13% in assets during first quarter 2008, she said, adding that at that rate, the credit union could add $7 million a year in business loans to its portfolio. "Credit unions serve a vital purpose in our community, which is very different than that of a bank," said Smith, adding that one need only to look at credit unions to see pioneering spirit. For the complete letters, use the resource links.