CORAL GABLES, Fla. – Credit unions in South Florida which are accustomed to providing services to small, mom and pop businesses, are now being serviced themselves by a mortgage lender which itself started as a mom and pop shop and still works exclusively with credit unions. Almost 20 years after it took on its first credit union client – University CU in Coral Gables – Home Financing Center has grown to be one of the largest independently and locally owned mortgage lender in south Florida, with five company-owned offices and 17 credit union locations. It has also added 10 other credit unions to its client roster including: Miami Postal CU, Miami; JetStream FCU (formerly FAA CU), Miami Lakes; Florida Health Systems FCU, South Miami, North Broward Hospital District FCU, Fort Lauderdale; Mercy CU, Miami; Med-Health FCU, Fort Lauderdale; Peoples CU, North Miami; Mt. Sinai FCU, North Miami; South Florida Educational FCU, Miami; South Florida FCU, Miami. Home Financing Center Co-owner and President Terry Claus Jr. – his sister Claudine Claus-Wheeler is executive vice president and co-owner – said the fact that so many of the company's credit union clients are hospital based is “just coincidence.” He explained that as a Fannie Mae partner, Home Financing Center uses a lot of the housing Government Sponsored Enterprise's programs designed for the healthcare industry that make it easier for healthcare employees to get Fannie Mae mortgages. Claus said a lot of the company's growth has come from word of mouth referrals. “When we started out in 1990 with University Credit Union, their program was so successful that one program led to another. There were a lot of referrals among credit union groups,” he explained, adding that these days Home Financing also does a lot of radio and print advertising. In 2003, Home Financing Center closed a total of $370 million in mortgages, 27% or $100 million of which were for credit unions – the remaining 73% was derived from walk-in business, a company representative said. In 2004 Claus expects Home Financing Center to close nearly $300 million in mortgages for credit unions. Of the mortgages Home Financing originates for the CUs, some remain in the credit unions' portfolio and others are sold by the company for the credit unions on the secondary market. Home Financing also services all the mortgages it originates for the credit unions. Its servicing portfolio is more than $715 million. “Each credit union gives us their parameters,” Claus explains. “Some only want to keep 15-year loans in their portfolios, others want a mix of 15 and 30 year loans with lower loan-to-value ratios. When a loan comes into our secondary market department, the first thing we do is offer it to the credit union for their portfolio. If they don't want to keep it, then we sell it for them.” Credit unions' mortgage needs are also influenced by their member profile, he added. “Each member group is different,” said Claus. “Some of the credit unions we do business with have a lot of Haitian members who are first time homebuyers. Others have a lot of doctors and physicians in their memberships who lean toward jumbo loans and adjustable rate products. Every one is different.” Having Home Financing Center representatives inside the CUs' branches is helpful, said Claus, and he considers this to be one of the company's major strengths. “When people are buying the most expensive investment of their lifetime, they want to sit down face-to-face when it comes to dotting the I's and crossing the t's. They want counseling.” As a Fannie Mae partner, Home Financing Center works closely with the GSE in developing specialty-designed home financing programs. For example, the company is in the process of piloting a Fannie Mae product called “Seniors and Families Together” – if a mortgage applicant has a senior family member living with them, Home Financing Center can use the senior family member's income and their income can be added to the application to help the applicant qualify for a loan. However, the senior family member doesn't become part of the loan and a credit check doesn't have to be run on them. “By not having their name on the application gives the applicant extra income without giving the senior family members any risk. When you have a senior family member living with you, a lot of time that person is helpful in offsetting certain expenses such as childcare and house cleaning, so in a lot of ways they're contributing to the household,” Claus explained. Another program Home Financing is working on with Fannie Mae is called “payment power.” Under this program, first time homebuyers who are concerned about losing their home because they may be seasonal workers or schoolteachers who are off during certain times of the year, are allowed to skip making mortgage payments during designated months. Claus said the applicant has to enroll in this program when they close on their loan. “Technology has made it easier for credit unions to do mortgage lending, but there's still a lot involved and that's why they want a relationship with us,” said Claus. -

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