The challenges facing credit unions in this market

HousingWire

On today’s episode, Editor in Chief Sarah Wheeler talks with Peter Benjamin, president of the American Credit Union Mortgage Association — ACUMA — to talk about the challenges credit unions are facing right now and what he’s excited about for 2026.   Related to this episode:   Mortgage purchase applications near 3-year high as spreads improve  https://www.housingwire.com/articles/mortgage-spreads-boost-demand/  ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠HousingWire | YouTube⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠  https://www.youtube.com/channel/UCXDD_3y3LvU60vac7eki-6Q  More info about HousingWire  https://lnk.bio/housingwire   The HousingWire Daily podcast brings the full picture of the most compelling stories in the housing market reported across HousingWire. Each morning, listen to editor in chief Sarah Wheeler talk to leading industry voices and get a deeper look behind the scenes of the top mortgage and real estate.

Transcript

00:00Welcome, everyone. My guest today is Peter Benjamin, president of ACUMA, the American

00:12Credit Union Mortgage Association, to talk about the challenges credit unions are facing

00:16right now in the mortgage space and what he's excited about for 2026. First, I want to thank

00:22our sponsor, Trust in Will, for making this episode possible. Peter, welcome to the podcast.

00:28Sarah, thank you so much for having me. Long-time listener, first-time guest.

00:32I love that. No, I'm so happy to have you. You know, I attended ACUMA's annual conference this

00:39year. Amazing. I loved it. We got to talk then and I was like, let's get you on the podcast.

00:44And then, you know, it's just taken a while. So I'm so excited to now have you on. And now we can

00:48kind of do a retrospective of the year and like what you're looking forward to in 2026. That's

00:54going to be great. That sounds perfect. That sounds perfect. Okay. Well, let's start here.

00:58Let's start with your particular members and what you think, you know, the biggest challenges right

01:03now are for them. You know, it's, that's tough because I, you know, I don't want to get into

01:10rates because I mean, I know that you and Logan dive into rates quite often and where we're heading

01:15on the economy. You know, for me, it's more of the idea that, you know, a lot of our members or

01:21even potential members, credit unions in general, you know, they're at this, this intersection where

01:29they are facing liquidity issues or they're unsure whether or not mortgage remains a vital role within

01:39their lending institutions or their institutions in general. And so when you, when you think about

01:45all the challenges that they face, I mean, it's volumes for the most part has been down as far as

01:50first mortgages go, you know, home equity has been up. Yes. And a lot of our credit unions are

01:54still originating home equity, but the tough part is, okay, well, first mortgage is really the key

02:00to communities. Home equity, in my opinion is, is not. And so getting them to remember that, that,

02:07you know, there's this fiduciary responsibility in the mission of a credit union to always support

02:14their, the communities that they serve. The best way to do that is through mortgage. And I think

02:18looking back, you know, that challenge has been there the past three years, especially because,

02:25you know, a lot of credit unions, when you think about 2020, 2021, you know, all they were really

02:29doing is portfolio in this 3% paper. You know, here we are, you know, three, almost four years later,

02:36and they're stuck. And so what do we do? We have to invest, we have to explore, we have to find ways

02:44to free up our balance sheets, or even start leveraging our balance sheets to originate those

02:52mortgages. And oftentimes credit unions are scared to do it because it's the unknown, you know, the

02:57unknown of what we lose our members, or we don't have the expertise in house, you name it. I think

03:03that's the biggest challenge facing credit unions and what I seen. And I honestly think it's going

03:09to probably continue for the next several years. I think it's what struck me so much when I was at

03:19your conference is just the different calculus that you guys have, right? So if you're an

03:23independent mortgage banker, that's all you do. You don't get to be like, yeah, we're not going to do

03:27so many mortgages this year. Like, no, if you're a big depository, if you're a bank, and you just look

03:33at the bottom line, am I going to make money? Am I not going to make money? Okay, you know, I'll make

03:37it on that. You guys are coming into it with this larger mission focus. That is not just that. So I

03:43can see how that is a, it's, it's more challenging in that way.

03:47Yeah, and I think you hit it, right? You know, we are very much mission focused,

03:51you know, dedicated to our communities. But you're right, when you come to our conference,

03:56you know, we talk, yes, how to originate, we, we, that's, that's been the backbone and foundation

04:02for our, our conferences since it started in 96. The tough part is, is that we've had to evolve,

04:10we've had to bring on, you know, servicing content, you know, content strictly focused on home equity.

04:16Now we're, we're getting requests to focus on, you know, the commercial side. You know, so in the

04:23commercial side, it's interesting because credit unions view commercial lending or residential

04:28commercial lending differently or business lending, you know, for us, you know, one, you know, in the

04:34mortgage industry, one to four family housing is residential all day long. You can originate that

04:39sell to Fannie Freddie with no problem whatsoever. For a credit union, that multifamily, that two to four

04:47has always lived on the commercial side or in business lending. But recently that's being pushed

04:56back into residential mortgages and our members. And although it does, it just, for you and me,

05:03it might make sense. And for the mortgage, you know, bankers that are out there listening,

05:06it might just make sense. But for credit unions, teaching them about multifamily is becoming more

05:12and more important. And that request continues to pop up. And how do we continue to, to expand our

05:20offerings and serve our members? Because let's be honest, one to four families is, or two to four is

05:27that they're, they're great properties. A lot of our members are probably going to, you know,

05:32go down that path, rent out the other portions, get some income. I mean, it's, it's, it's interesting

05:39how we continue to evolve based off the needs of our, our members.

05:44So talk a little bit about who, who are your members? What is, what does that profile look

05:48like? Where are they? What kind of, you know, community are they in?

05:54Good question. Good question. You know, our, our members are national. We have credit unions,

05:59you know, ranging from, you know, the DC area all the way up to Guam, you know, or down to Guam.

06:05Um, you know, for us, you know, we focus on any credit union that originates mortgage or home

06:12equity that that that's our, our, our main focus. Uh, right now we have about, uh, 430 credit union

06:20members, uh, that range anywhere from the biggest of the big to ones that on paper, you're actually

06:29shocked. They're originating as much as they are, uh, because they're so small and from a depository

06:35side. Um, so it's our, our members are dedicated to mortgage. Uh, when you look at the top 500

06:42originating credit unions for, for our first mortgage standpoint, about 60% of them are,

06:48are members of ours. And so our goal right now is to really capture what 2,500 credit unions

06:55originate. Our goal is that may ensure that every single one of those credit unions become a member.

07:00That way we can expand our community, expand our education, our network. But we also know that if

07:06we're hitting all 2,500 of those credit unions from our membership level, we're only improving

07:12our side of that, of this ecosystem through education and collaboration.

07:17Yeah. I love that you brought up education, some of those other focuses. I was really struck at your

07:22conference by advocacy and how much of that, that you guys do and how you guys are making sure that

07:27your members are represented, um, as you collaborate with other groups on mortgage and, and things that

07:33DC needs to know, uh, where would you say you guys focus this year?

07:38You know, that's tough because I think we have a great relationship with other trade groups, you know,

07:45NAMBA, uh, mortgage bankers association, uh, America's credit union, uh, you know, the national, uh,

07:52credit union association, and we have great relationships with them. But for us, when you

07:58actually look at the efforts that we do, those efforts are more so geared upon trying to bring

08:06awareness to what a credit union is and that credit unions fundamentally originate mortgages.

08:13We serve our communities and that if, if a, a lawmaker has a question that the best person

08:21to answer that question is going to be someone from a credit union because we're entrenched in our

08:26communities. You know, it, when I think about, you know, things that I'm hoping to see, you know,

08:32in 2026, you know, I'm, I'm fascinated with, you know, the road to housing act. I think, you know,

08:39that, that when the Senate banking passed it unanimously and you kind of read through everything

08:45that they're trying to do with it, you know, on paper, this seems like probably one of the first

08:51big things that could be a massive win for housing in several years. You know, obviously, you know,

08:58the house it's now with the house and, you know, they are really looking at, you know, how to put

09:03their, their, their, their thumbprint on it. But I think ultimately, if it maintains the spirit of

09:10what it currently is coming out of the Senate, I think credit unions, especially when you look at

09:16small dollar amount lending really have the ability to positively impact their members, but also

09:25take a hard, hard look at whether or not we can continue to push forward and invest in that

09:32mortgage originations. It's, I mean, as far as I'm concerned, that that's probably the biggest

09:37win I'm hoping comes out of 2026. Really interesting. So 2025 has been a year of a lot

09:44of change, right? From that DC level. Obviously the Trump administration ran on deregulation and we

09:50have definitely seen some, you know, I mean, basically taking an ax to the CFPB. Anytime we write

09:55about the CFPB, we have a picture of an ax cracking the building, you know, because to us it's like,

10:01that's kind of like, that's not hyperbole. I mean, that is not hyperbole this year that,

10:05that that's happened. And I think that many in mortgage would support that specifically because

10:11there had been so much overreach. But I have heard from others that are like, yes, you know,

10:15definitely. But there is always a potential when you have that federal present step back,

10:22you have all 50 states step forward. And in some ways you could be in a, in a worst case. How do you

10:27see the deregulation, um, around mortgage right now?

10:31You know, it's, you know, for credit unions, it's tough because oftentimes

10:35when you, when you look at individual credit union, you know, and I'm not looking at,

10:40you know, the big guys, the ones that are, you know, 10 billion and above, you know, they have

10:46been forced to build up their, their compliance controls. But when you look at the average credit

10:52union, you know, the average credit union is less than 500 million in assets, right? Which means

10:58that they're probably originating, uh, 50 million a year, right? So comparatively speaking, small

11:06potatoes to what some of your listeners might originate. When you, when you look at those credit

11:14unions and even look at credit unions that are, you know, 3 billion in assets originate, you know,

11:19half a billion a year, oftentimes compliance lives within the department. There's no compliance

11:27expertise within the compliance department. It's, it's the compliance expert is the head of mortgage,

11:33head of operations, someone like that, you know? And so when to kind of go back to your question

11:39for me and having lived in that seat where I was, you know, yes, the head of a mortgage division,

11:45I was also the head of compliance that the, my division's compliance. And so anything that,

11:52that provides clarity and anything that makes my ability to comply with any type of regulations,

12:02I'm all for, I think that's what credit unions really ultimately need. Give us a clear sound

12:08direction of some of the path that we need to take and we're going to do it. We're going to remain

12:12compliant. We're going to always be a little bit more conservative in our, our underwriting processes,

12:19but give us, I want to, I don't want to say black and white, but almost black and white

12:26instructions of how we need to comply. It's, I think that for me is, is the only thing that comes

12:33out of it. And I think you and I can agree on this, that you said, you know, the states are going to

12:38pick it up. Right. And I agree that the states will pick this up, but also what happens when a

12:47Democrat is back in office, right? You better believe that they're going to come back tenfold,

12:55rebuild the CPV. It's going to be real regulation by enforcement all over again. And those people who

13:02really didn't follow that path of what's in Dodd-Frank and spirit are really going to be the

13:08ones that are going to be pushed out. And so for me, credit unions really just have to need that

13:13clarification. Um, I'm not a compliance person. I never, I know enough about compliance to be

13:18dangerous, but having the ability to know yes or no, and not have to read between the lines is

13:26something I would ultimately want. I just think that that is so, um, it's so fundamental and I,

13:33it's something, it feels like they just don't understand. So, you know, I was at Housing Wire

13:37when Richard Cordray was very much like, you know, uh, I mean, he came out and said, so he used to,

13:42for people who don't know, he used to be the director of the CFPB. And he was like, if we give

13:46them black and white rules, they'll just figure out ways around it. So the way to go is just to do,

13:52uh, regulation by enforcement. So you never know what you're doing. Is it, is it right or wrong?

13:57And then when they slap somebody's hand or slap a huge fine, you're like, okay, I have to take

14:01the right lessons out of that. And it's like so inefficient and crazy. If you're running a

14:08business to try to figure that it's like, literally just give me the black and white rules.

14:12Right. And so I think back to, you know, when they rolled out Trid, right. And the CPB would have

14:18all of the, the Trid webinars where it was supposed to be framed up as, you know, this is how you

14:24originate a construction loan in under Trid, right. Or something like that. This is how you read the

14:29LE. All they were doing at that time was reading the act and referencing Romanettes. And if I heard

14:39the word Romanette one more time, I was going to run through a brick wall because they weren't answering

14:44any questions. They were just, I could have just read that myself half the time and, and save myself

14:49this hour of trying to understand how to originate construction loan through Trid. They, I, they,

14:56in many ways, and this is me speaking, it's almost as though they purposely were vague in those

15:01trainings to kind of fall back on what you said, you know, the, we'll just enforce this later down

15:07the line. Um, so hopefully we don't see that again, but you never know.

15:11You never know. Fingers crossed. Well, let's, let's go back to that road to housing act a little

15:16bit. What about that gives you, makes you optimistic that if that got through, we would

15:22all be better for that in the housing industry. I mean, I think what, you know, when it boils down

15:27to it, they did a very good job of providing a clear path for affordable housing, right. The,

15:35that low dollar amount, I, for my opinion, it was probably one of the biggest wins in that

15:42affordability is the biggest issue. We all know that. I mean, I, you talk about it quite often with,

15:47with Logan and no, there's low dollar amounts, anything under 200,000 are oftentimes caught up

15:55in that, that crossroads of, can we originate this compliantly and avoid any high cost tests,

16:03right. The fact that they provide clarification on that within, or the, the framework to allow

16:08someone to originate a low dollar amount loan within roads, I'm hoping provides better access for

16:17communities actually have homes in that, with that dollar amount to housing. I mean, that right there,

16:24and I, and was something I was excited about because I saw credit unions truly stepping up

16:31to kind of fill that void on those smaller dollar amounts. Credit unions don't need to win on jumbo

16:36loans. We don't, we need to win on the everyday loan that our members face. And really ultimately

16:45it's going to be that 200 and under loan amount. That right there was what's with the thing,

16:50the one thing that I liked a lot about it. Interesting. And I would say that that, um,

16:55that borrower is not somebody that a lot of people are chasing.

16:58No, no, no, they're totally getting ignored. They're totally getting ignored. And if we truly

17:04are community based institutions, we have a fiduciary responsibility to serve those members,

17:12those members at $120,000 loan amount. That's how we win. Let's focus on the quantity and not so much,

17:21I don't want to say quality because that's bad, but let's focus on that quantity that will get us

17:25to that point of success. Yeah. You know, I just, um, did a podcast that will air a little bit later

17:31with Freddie Mac about their cost of origination report, the survey they do. And, you know, yes.

17:38Okay. Finally it, uh, you know, it's, it is a positive number, but it's just crazy how much work

17:45goes into making that amount of money. Um, one of the things that they really point to is like,

17:51and we all know is like technology is, is supposed to deliver that efficiencies and help. When you

17:57look at the credit union space, what role does technology play for you guys? Good question. Uh,

18:03you know, I think you and I can also agree that when you look at technology as a whole, you know,

18:09we're, we're, we're kind of sort of in this golden era of technology when it comes to the mortgage

18:14industry, but our industry is still two steps behind everyone else. When it comes, every other

18:22industry, you know, healthcare is a good example. Our industry's years behind them. Credit unions are

18:31probably years behind any other IMB or bank. I'm not saying every credit union, but a lot of credit unions

18:38out there are, you know, I had just wrote a white paper, why I focused on, you know, the, the need to

18:46invest in mortgage. And part of that was the technology component of it, that the modern mortgage

18:53borrower is there. And that this idea of relationship building is great. Yes. A mortgage leads to a

19:02relationship, but today's borrower, today's member wants everything at their fingertips. And so the credit

19:10unions that understand that have seen success and are able to grow their market share. The ones that

19:19aren't are really falling behind. Now, the tough part with technology is like you said, there is always a cost

19:26associated with it, regardless of whether or not technology is framed up as something that's going

19:30to provide improvement. There's that, that costs to enter that a lot of credit unions just can't

19:38afford to get into, you know, so that's, it's almost a double-edged sword. When you think about it,

19:46they need this technology, but they can't afford to get it because it's the price out of the market.

19:51You know, some of them are going to, you know, CUSOs, which for us, you know, CUSOs are

19:57mortgage, mortgage company owned organizations that we can leverage their technologies, but still

20:09not being able to afford it. It's not a reason to sit on that sideline. And that's all I'm going to say.

20:15It is a really interesting conundrum because, you know, say on the IMB side,

20:20what they're really struggling with right now, among other things is that relationship-based,

20:25you know, get, getting the lead because, you know, there's so much technology now that,

20:30and you have a lot of the bigger lenders who, you know, if you think about Rocket and,

20:34and Mr. Cooper, like you're, you're, they're getting to that person first. They know what's

20:39going on with their servicing and all that. They have a lot of technology on, on your side. I feel like

20:44you guys have the relationship. That is not the problem. You guys have the relationship,

20:49which to me is going to be key going forward because of all what I just said, because it's

20:55getting so getting that lead, understanding where that person is, is to me, the differentiator going

21:01forward. And so in that way, even though maybe you don't have that technology, I feel like that

21:05relationship is going to do you well. Oh, absolutely. Absolutely. It's, but, you know,

21:10the relationship is only going to go so far because if, if we can't fulfill their needs,

21:16they're going to go someplace else, you know, the number of times, you know, when I was at

21:22Lafayette federal credit union, the DC area, and I was our head of mortgage division for a long time,

21:26the number of times I, I, I picked up the phone and there was a member on the other line.

21:31And one of the first things that they said was my grandmother told me to come to you for a mortgage,

21:38right? And that, that right there is the heart of credit unions and the relationships that we have

21:46with, with all of our members. The tough part is, is that, okay, well, you know, grandma just referred

21:53this, this, this younger member over to us for a mortgage. If we are behind the times, or if we

22:01aren't able to allow them to go through this process, how they want to go through process,

22:06go through this process that they're already going to a competitor down the street. And I think that's

22:14one thing that credit unions often miss is that we have to meet them where they want to be, not where

22:19we want them to be. It goes back to, you know, it always grinds my gears whenever a loan officer would

22:27send just the application to the member, you know, through our online portal, but then not walk them

22:33through it or walk them through the disclosures, you know, because they think that's what the member

22:40wants. No, it's not what the member wants. They, they, they want to be handheld. Yes, they want

22:45technology, but they still want that hand, their hands to be held. So, I mean, it's, I, that's

22:51probably actually one of my biggest concerns with credit unions is that we have not invested enough

22:55in mortgage technology. You look on auto, you look on the consumer side or even deposits,

23:01it's all there. It's that mortgage side that they're not really investing in.

23:08When you look at 2026, what, um, what's your outlook?

23:12I want to plead the fifth on that one. Um,

23:15Well, you know, I, I thought about framing and I was like, what are you excited about in 2026? I was

23:20like, well, no, let me ask you, like, are you excited about 2026? Yeah. What does it look like for you?

23:25Yeah. I'm excited for it. I think that we have, you know, when you look at the more credit unions

23:30and what we've done over the past year, I think our efforts over at ACUMA have really started moving

23:36the needle on credit unions, one coming into the, the mortgage phase, but two really growing our,

23:44our market share. Um, I mean, you, I mean, you can look at, you know, recent HMDA data to see that,

23:50you know, a lot of credit unions are starting to get into this home improvement type products,

23:54you know, I'd like to relate that back to the education that we do over here at ACUMA providing

24:00them that gateway to home improvements, you know, so I'm excited that, you know, for the fact that

24:06our efforts continue to help our members and it's seen in the numbers, you know, I'm not going to

24:12quantify, you know, what I hope for next year, but if we can continue to take back market share,

24:17you know, percentage by percentage every single year, I think that's what I'm pretty happy about.

24:24No, that's, that's a positive outlook actually. And I know that Logan feels like, you know, there is

24:29some, some business pickup to be had in 2026. No one thinks it's going to be a banner year that

24:34we're all going to look back on and be like, wow, but it's going to be better than we've had.

24:38And that's, you know, I think everyone's happy about that. Absolutely. Absolutely. Peter,

24:43thank you so much for being on. It's been great to talk to you. I will have to have you on again

24:47regularly so we can keep up with your members and what's going on there, but thanks for being on.

24:51Thank you, Sarah.

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