Last week I stopped in at a recreational vehicle dealership to browse travel trailers. As I spoke with the salesman, he mentioned they had been having a problem for most of the year.
There has been plenty of discussion over the last many months about how the community banking world might look when we come out of this pandemic. Speculation and opinions are all over the board. The economic fallout is of great concern, and community lenders find themselves juggling priorities and recalibrating for the future. On the consumer-facing front, digital banking and technology are hot topics, ‘strategic innovation’ is a focus, and customer relief and mediation tactics are a balancing act. Inside the lending operations, there are concerns about PPP loan forgiveness, increased delinquency and default impacting collections staff, and continued remote workplace struggles with administrative workload balance adjustments across operational teams.
Green energy incentives are financial rebates or rewards from the U.S. government or a local utility company designed to encourage property owners to incorporate energy-efficient products, water-conserving, renewable products, materials, or measures into their home or commercial building renovation projects or use them in new construction. The incentives take various forms. There are tax credits, rebates, tax deductions, grants, subsidy programs, and more. Examples of eligible upgrades include solar, geothermal, and fuel cells, certain types of insulation and roofing materials, and exterior windows with specific energy efficiency ratings.
Credit Unions as member-owned cooperatives have always kept their focus where it should be: their members. Credit Unions constantly make sure everything that is done is member friendly and that members know they are part of the family. More and more credit unions are re-evaluating internal programs to make sure they live up to the goals they set concerning member relationships. One product receiving a lot of attention is Collateral Protection Insurance (CPI or Force-Placed insurance) with outsourced tracking.
Home equity lending has been a staple of community banks and credit unions for many years, having been a valuable source of funds for life events for families across generations. These loans are offered in varying loan types, whether open-end HELOCs or fixed-term loans, with different guidelines around credit scores, debt-to-income ratios, and combined loan-to-values (CLTVs). The exact loan types and guidelines offered are determined by the lender’s risk tolerance for the product. One of the most challenging aspects of structuring a home equity program is identifying your maximum combined loan-to-value limit. Utilizing a credit default insurance program can make that decision easier.
In every town, city, and state across our country community lenders play a vital part in the mortgage economy. Their pivotal role has been highlighted yet again in 2020 as they help families and businesses face the unique challenges this year has presented to all Americans. While they exist in every community, no two community lenders are the same. For that reason, no two mortgage portfolios are exactly alike.
