Lending in 2021: What’s Next for Credit Unions?
CUs originate more than $80 billion in first mortgages through three quarters of 2020, with the Midwest seeing the largest increase.
Credit unions did better than expected in 2020, but still lost a little ground in auto loans and mortgage originations.
Car loans accounted for about a third of credit union portfolios and real estate accounted for about half.
Credit unions and banks have been capturing a smaller portion of auto loans because of captives, especially for new cars, and from online disruptors like Carvana, which both sells and finances used cars.
Based on Fed G-19 and NCUA national data, credit unions held 31% of outstanding auto loans as of Sept. 30, down from 31.1% in June and 31.7% in September 2019.
Estimates revised Dec. 21 by the Mortgage Bankers Association showed first mortgage originations by all lenders topped $1.08 trillion for the three months ending Sept. 30 – the first time a quarter’s total has topped $1 trillion since 2003.
The rising total also means that credit unions’ share of originations was smaller. Originations were 7.6% for the third quarter instead of the 8.4% based on the MBA’s Nov. 18 estimates and the NCUA’s national quarterly data released Dec. 4 for the nation’s 5,133 federally-insured credit unions.
The MBA’s Dec. 21 report made no changes to mortgage balances. The credit union’s share of the nation’s pool of mortgages was 3.9% on Sept. 30 – unchanged from June and up from 3.6% in September 2019.