With warmer weather approaching, it is time to start thinking about your members and their homes. They have dreams, after all. Maybe they dream of a strong new roof, a larger addition, or beautiful kitchen upgrade. Our Home Equity Lending Forms Packages have everything you need to make their dreams a reality. This type of lending remains a popular choice for many homeowners. In 2015, home equity lending saw a 20% increase as compared to previous years. Customers like the surety of a fixed-interest rate, or the flexibility to tap a line of credit if they decide to do a bit of home renovation.
The Home Equity Landscape
Changes are on the horizon, though. Current projections expect a home equity lending interest rate increase to land at 6% or 7% by the end of 2018. These projections are based on current federal prime rates expected to increase over the next two years. Of course, anything can happen, but should a likely increase occur, you can attract members with lower rates. Typically, banks and other financial institutions have higher rates than credit unions.
Some are offering home equity lines of credit with a fixed rate option. You may win the day offering your members a closed-end equity lending option. Our forms package covers both types and can be customized to meet your credit union needs.
Offer Members a Better Option
Use this information to market home equity lending to your members. As rates increase, you can give them the option on the lower end of the rate spectrum. Make sure your members can get that leaky roof fixed, or renovate their outdated bathroom. It’s a win for you and a win for them. That is something you can both live with, under different roofs of course.