18 Strategies In 18 Months
By Joe Brancucci, Chairman & CEO Prime Alliance Solutions, Inc.

I hoped you've enjoyed Prime Alliance's 18 Strategies in 18 Months, the daily e-mail we began sharing with you on June 2. We believe three things about the current market. First, the opportunity handed us as a result of the sub-prime crisis has an 18 month lifespan. Second, working together, our goal is positioning credit unions as our members' first choice for housing finance. Third, we must focus on these strategies as a starting point to accomplish this goal. And the goal? It's the Big Hairy Audacious Goal (BHAG) set by the CU Housing RoundTable in 2006. Ten percent market share by 2016, 'Two to Ten' as it's commonly known.

The 18 Strategies you've had the opportunity to read this past month have many origins, yet they share a common purpose: to help credit unions put more members in homes more affordably. Eighteen is quite a few, I admit, yet I believe in every one of them. The role of strategy is to move us from our present market position, that of refinance lender for some of our members, to that of purchase-money adviser and lender for all of our homebuying members. Didn't see all 18? Visit www.18strategies.com and spend thirty minutes. There you'll find a brief summary of each strategy, with the full strategy just a click away. Or visit www.primealliancesolutions.com to download the 18 Strategies in 18 Months document. Where the site will give you a synopsis, this document provides more. In it you'll see Prime Alliance has a follow-up plan for each strategy. Defining strategy is important. Executing on them is key.

Please use the 18 Strategies however you choose, but please, do use them. Download and distribute it, use it as a discussion item at an upcoming management team meeting, share it with your Board, choose those strategies that either fit your current model or the new housing finance model you've been contemplating. As I learned from Ross Shafer during the CUDL Conference this past week, the number is not important, the action you take is what matters.

Like you I am passionate about credit unions and I believe unabidingly that we must play a primary role in financing homes for our members. In many respects the opportunity we now have as mortgage lenders is the same opportunity we seized as automobile lenders more than fifty years ago. We were, and are, the affordable auto lender. We can and should be the affordable, sustainable mortgage lender. Car loans result in transportation, an initial linch-pin of financial security Home loans meet a more fundamental need, the need for shelter, the key to personal security and financial well-being. We must do both well for the well-being of our members .

And remember: while this may be the first you've seen our 18 Strategies, it won't be the last. The 'Want More?' sidebars in the 18 Strategies document gives you a brief idea on what we have planned. There's no need to wait, though. Additional information is already available for strategies one, two, four, five and fourteen, for instance. The CU Housing RoundTable, which will hold its Third Annual Meeting on October 16 - 17, 2008 in Seattle (you are invited, by the way, visit www.cuhousingroundtable.com for the details), is developing White Papers based on strategies three, four and seven. Prime Alliance is also offering webinars and classes on a number of them. SMS Univeristy is holding schools this Summer on FHA Lending. We're as serious about this as we are about helping credit unions finance homes for members.

Finally, I'd like to use the 18 Strategies to start a dialogue about the role credit unions play in housing finance. So, share your thoughts with me and your peers on the 18 Strategies Blog, which debuts today at www.18strategies.com. I'll bet we can refine and add to these strategies so that credit unions achieve their full potential as mortgage lenders.

The Magical Mystery Tour Ends...But The Journey Continues
By Joe Brancucci, Chairman & CEO Prime Alliance Solutions, Inc.

It’s hard to believe, but it's already been more than a month since The Magical Mortgage Mystery Tour took place in Seattle. For those of you who attended, I think you'd agree it’s the best of the six Prime Alliance Symposia we've held so far. For those of you who were not able to attend, no worries. We'll be publishing the annual Symposium CD very shortly.

No question, Symposium is the highlight of the year for your Prime Alliance Team. We enjoy putting the program together for you, lining up the best speakers the industry has to offer, packing the agenda with valuable information you can use immediately, all while making sure we leave enough time for the most valuable part of Symposium: networking with your peers. The best ideas are often discovered in one-on-one conversations during the breaks. We hope you found both the sessions and the networking to be top-notch this year.

Highlights of this year’s Symposium include:

• New Business Development – FHA, Mortgage Awareness Campaign, Prime Possibilities
• Processing Efficiencies – Prime Combined Services, New Vista Mortgage Loan Report, Paperless Mortgages
• Safety and Soundness – Servicing Collateral Valuations, MSR Valuations
• Prime Alliance Award Winners:
  Platinum Record: BECU - "Best Overall"
  Gold Record: Consumers Credit Union - "Significant to Members Award"
  Gold Record: Vystar Credit Union - "Most Innovative"
  Gold Record: myCUmortgage - "CUSO of the Year"

While the 'Tour' ended on May 7, our journey is never ending. Many of us who attended this year have participated in three, four or five of the previous Symposia. That's the true value of the Alliance: we are a community of credit union lenders who are committed to affordable, sustainable housing finance. That's why the journey never ends: housing finance will always have its share of challenges. This year it's the fallout from the sub-prime apocalypse. Next year, we're probably back to affordable housing. There will always be a challenge for us to face, and we're at our best when we face these and other challenges together.

Helping members obtain homes, the toughest economic challenge most will ever face, has been made easier because of this Alliance you've helped form. We've been able to lower the cost of many settlement services over the past several years. This year we announced Prime Combined, an approach to bundled services that reduces the already low costs we've achieved even further. We've also added Prime Possibilities, the highly targeted marketing tool that helps you locate members who will be financing or re-financing in the coming weeks and months. Prime Possibilities offers an added benefit in these uncertain times: it can help you locate members in need of sub-prime rescue assistance. The Mortgage Awareness Campaign is simply the most comprehensive mortgage-marketing program available in the industry today, allowing your credit union to tell your members the “credit union story”.

While there are many more examples of how working together as an Alliance helps us put more members in homes more affordably, I mention these three for this reason: highly discounted, bundled services and highly sophisticated targeted marketing tools had been the playground of only the largest lenders until recently. Fact is, as an Alliance, we are as large as the top ten lenders in the Nation. That translates to buying power we can't achieve individually as credit unions. It also translates to improving housing affordability for our members.

So the journey continues. It began thirty years ago when we first became mortgage lenders in the eyes of our regulators and our members. It will continue well beyond the next thirty years, I'm quite sure. So, until we all meet again for the Seventh Annual Symposium, let's remember we're an Alliance of credit unions whose lending objectives perfectly match the needs of our members and of the general public. We're trustworthy, we're reliable, we're affordable, and our financing is sustainable. Working together it will only get better.

One last thought. The next stop on the Journey is, in fact, the Seventh Annual Prime Alliance Symposium. We're doing things differently in 2009, we're holding next year's meeting in conjunction with CUDL. That's right, the largest mortgage solutions CUSO is getting together with the largest indirect auto lending CUSO to hold a combined lending Symposium. Mark your calendars now - May 13 through 15 at the Bellagio in Las Vegas, NV. Why together? Like all of us, who are better together, we figure PA and CUDL can put on a better, more powerful Lending Symposium by working together and maximizing both of our CUSO’s resources. Watch for more details soon.

Have You RAMPD Up Your Loss Mitigation Efforts to Help Your Members Avoid Foreclosure?
By Tammy J. Trefny, Affinity Relationship Manager—National Affinities Team.

We’ve all heard the statistics: loans in serious delinquency are at record-high levels, the inventory of unsold homes is almost twice as high as historical levels, consumer-debt levels keep rising, and so on. The bottom line is that more and more credit union members are hurting and in need of assistance. The question is what can you be doing to help them avoid foreclosure?

Fannie Mae is committed to providing you with a variety of loan resolution options to help your members stay in their homes and/or avoid foreclosure. The RAMPD framework outlines the preferred order of consideration for the use of loss mitigation options and provides a useful reference for assisting your delinquent members:

• Repayment Plan – an arrangement in which a borrower agrees to pay down past due amounts while still making regularly scheduled payments;
• Advance – HomeSaver Advance™ (described in more detail below) – a monetary advance to cure a delinquent loan resulting in a separate unsecured loan for the arrearage amount;
• Modification – any change to the loan terms of a first lien mortgage loan, including changes to the interest rate, loan balance, or loan term;
• Pre-foreclosure or Short-Sale – the acceptance of a sales contract prior to the foreclosure sale resulting in a payoff of less than the total amount owed on the first lien mortgage loan; and
• Deed-in Lieu – the voluntary transfer of title from a borrower to the servicer to satisfy the first lien mortgage loan and avoid foreclosure (also called a “voluntary conveyance”)

HomeSaver Advance
Fannie Mae has recently introduced to servicers this new loss mitigation option that provides an unsecured personal loan designed to bring a delinquent loan current. Funds from the loan go toward curing arrearages of principal, interest, taxes, and insurance (PITI), as well as other applicable advances and fees. The unsecured loan is documented by a borrower-signed promissory note, payable over 15 years at a fixed rate of 5% with no payments or interest accrual for the first six months.

HomeSaver Advance is designed for your members who may have fallen behind on their mortgage, but are able to resume timely payments once their loan is brought current by the advance. It helps to simplify and streamline the workout process, by providing an option for earlier resolution of delinquent loans.

For More Information
For more information about Fannie Mae’s servicing solutions and loss mitigation options, please visit the Servicing Resources page on eFannieMae.com.

For a summary of HomeSaver Advance, please review the HomeSaver Advance Fact Sheet posted on eFannieMae.com.
 
We look forward to working with YOU
Credit unions are well positioned to provide their membership with sustainable home financing options that have been and continue to be at the very core of their business. And, in this challenging market, helping those in need is at the forefront of all our efforts. Fannie Mae will be there for YOU in all market conditions, and with YOU in the communities that you serve.

• Contact your account manager or Tammy Trefny at 312-368-6218 or tammy_j_trefny@fanniemae.com to discuss the benefits of the Prime Alliance/Fannie Mae strategic relationship.

Servicing Solutions Center
Call 1-888-FANNIE8 or 1-888-326-6438 and choose option 2

• Our consultants are available to handle your servicing-related inquires Monday – Friday, 9:00 a.m. to 8:00 p.m. ET.
• Or, e-mail us:
  Send a general inquiry
  Send a loss mitigation inquiry