Mortgages Hit New Peaks for Credit Unions in South, Northeast

Credit union mortgages inched up in the second quarter nationwide, but large swaths of the nation from New England to the West Coast saw drops in comparison to the surge in originations that started a year earlier.

Among the nation’s four Census regions, only the Midwest region saw a decline. Its originations were $18.1 billion, down 6.5% from 2020’s second quarter.

But drops occurred in smaller Census divisions elsewhere based on a CU Times analysis of NCUA data with originations weighted by the number of branches by state for each credit union.

All areas showed increases from this year’s first quarter to the second quarter.

But the 12-month drops among Census divisions contrasted with the first quarter, when each of the nine divisions showed an increase from last year’s first quarter.

The story is all about patterns created by the COVID-19 pandemic. When it began in March 2020, first-mortgage originations were only $49.9 billion in the first quarter.

Low interest rates and better-than-expected income fueled a surge in originations, especially for refinances. Originations peaked at $81.7 billion in 2020’s third quarter and fell to a post-surge low of $74.5 billion in this year’s first quarter.

Within that, regions have behaved differently.

The South and the Northeast hit their post-pandemic highs in this year’s second quarter, while post-pandemic highs were reached in the second quarter of 2020 in the Midwest and in the third and fourth quarters of 2020 in the West.

In the Northeast the pattern has been flattest among the regions. Its originations were $11.2 billion in the second quarter, up 6.4% from a year ago and up 13.1% from $9.9 billion in the first quarter.

The Midwest had the steepest increase from the first to the second quarter of last year. Originations were $18.1 billion in this year’s second quarter, down 6.5% from a year ago and up 5.8% from $17.1 billion in the first quarter.

The South had the strongest resurgence from the first to second quarters of this year. Its originations were $24.2 billion in the second quarter, up 6.8% from a year ago and up 14.7% from $21.1 billion in the first quarter.

In the West originations were $27.6 billion in the second quarter, up 3.7% from a year ago and up 4.9% from $26.3 billion in the first quarter.

The 10 largest first-mortgage originators in the second quarter produced $19.2 billion, up 25.4% from 2020’s second quarter. The Top 10 were:

1. Navy Federal Credit Union, Vienna, Va. ($147.9 billion, 10.6 million members) originated $6.7 billion, up 9.5%.
2. PenFed Credit Union, Tysons, Va. ($27.7 billion, 2.3 million members) originated $4 billion, up 127.1%.
3. Lake Michigan Credit Union, Grand Rapids, Mich. ($10.4 billion, 413,178 members) originated $1.6 billion, down 5.7%.
4. State Employees’ Credit Union, Raleigh, N.C. ($49.9 billion, 2.6 million members) originated $1.3 billion, up 19.2%.
5. First Tech Federal Credit Union, San Jose, Calif. ($14.1 billion, 639,544 members) originated $1.2 billion, up 29.2%.
6. Idaho Central Credit Union, Chubbuck, Idaho ($7.5 billion, 461,794 members) originated $1.1 billion, up 122%.
7. SchoolsFirst Federal Credit Union, Santa Ana, Calif. ($25.9 billion, 1.2 million members) originated $1 billion, down 2.1%.
8. BECU, Tukwila, Wash. ($28.6 billion, 1.3 million members) originated $901 million, up 8%.
9. Bethpage Federal Credit Union, Bethpage, N.Y. ($11.2 billion, 432,371 members) originated $771.8 million, up 31.4%.
10. OnPoint Community Credit Union, Portland, Ore. ($8.5 billion, 443,451 members) originated $744.2 million, down 12.7%.