Disillusioned with big banks, borrowers turn to credit unions

Borrowers seeking a new purchase loan mortgage or those looking to refinance are increasingly turning to credit unions.

The growth has mostly been attributed to a surge of refinancers and a growth from consumers’ “disillusionment with big banks,” The New York Times reports.

These financial institutions are expected to surpass a record-breaking $100 billion in mortgage loan originations this year.

“We’d be remiss if we didn’t give a shout-out to the major banks for being annoying to consumers and forcing people to seek out other alternatives,” said Bob Dorsa, the president of the American Credit Union Mortgage Association in Las Vegas.

Credit unions may offer slightly lower closing costs than banks. Another potential advantage, housing experts note, is that credit unions mostly keep their servicing on all of their mortgage loans in-house – incentive for them to be more responsive to their customers.

“Historically, when rates go up and refis go down, our share and origination volume drops,” Dorsa said. “We’ve made a concerted effort this time to get out in front of realtors, so we hope we won’t take as much of a hit production-wise as we have in the past.”