My first mortgage experience
Unlike my experience of refinancing my mortgage with a credit union, my first experience getting a mortgage wasn’t about sustainability or enjoyment.
My offer on my dream home was accepted in 2016 – a surprise in a very hot seller’s market. But I had no idea how mortgages worked. My real estate agent also went MIA when my offer was accepted. I fumbled in the mortgage dark.
Thankfully, a few friends helped to shine light on the mortgage process. I ended up with a respectable mortgage interest rate of 3.75% for 30 years at HomeStreet Bank. Three years into my mortgage, my mortgage was sold to Flagstar Bank, a bank with which I had no familiarity. The sale of mortgages is common, and out of the hands of the buyer.
The Option to Refinance My Mortgage With a Credit Union
Since my initial mortgage process, I have discovered the wonderful world of not-for-profit credit unions. Credit unions offer community focused banking and lending.
Refinancing is paying off an existing loan such as a mortgage and replacing it with a new one. Borrowers usually refinance in order to receive lower interest rates or to otherwise reduce their repayment amount.
Rates for mortgage refinancing have decreased recently due to the impact on the economy of the COVID-19 pandemic and the subsequent Federal Reserve actions. When I saw low refinancing rates, I realized that I could lower my rate AND go sustainable.
Refinancing my mortgage With a Credit Union: sustainable and enjoyable
Verity Credit Union, which is open to anyone who lives, works or worships in Washington, came recommended to me. Verity was an instant “swipe right” for me on mortgage refinancing Tinder. Thankfully, we were a match! I’m still in the refinancing process but my new match has me enamored.
The credit union will be saving me a significant amount of money over the lifetime of my loan. My rate will decrease from 3.75% to 3.125% for a 30 year mortgage. This will save me approximately $250 per month. Additionally, Verity Credit Union is a not-for-profit which is member-owned. It supports and invests in the local community. It also offers sustainable loans.
Finally, my loan officer has provided me with amazing customer service (thanks, Sterling!) Verity processes their mortgages through CU Home Mortgage Solutions (CUHMS), a mortgage company they own in partnership with another local credit union. CUHMS only provides mortgage solutions so the team is knowledgeable and helpful.
I recognize that there is a chance that Verity may sell my mortgage. However, credit unions have a high likelihood of keeping a mortgage for many years, much longer than a commercial bank. Additionally, all loans except government loans (i.e. Veterans Affairs, Federal Housing Administration) are serviced by CUHMS locally even if Verity does sell them to the Federal National Mortgage Association aka Fannie Mae.
Check refinancing rates
Refinancing rates have been volatile so check current refinancing rates. Also keep in mind that average closing costs with taxes are $5,779. Use a refinancing calculator to see if refinancing with a credit union could be for you. Find your local credit unions.
If you’re interested to join Verity Credit Union, you can sign up through the referral program – earn $150 free cash if you meet the required criteria and provide my name (Courtney Blodgett).