Credit Union Mortgage Requirements: What Do You Need to Qualify?

When it’s time to shop for a mortgage, don’t forget to consider financing your home through a credit union. Credit unions offer a wide variety of home loan options, and they are committed to strong customer service throughout the process too. If you’re thinking about buying a new home or refinancing your current house, here are some credit union mortgage requirements to review.

Joining the credit union

A credit union functions similarly to a bank – they offer financial services like checking and savings accounts, home loans, car loans, and more, but you need to become a member to enjoy the benefits. Don’t worry – becoming a member is a simple process. While the membership requirements vary with different credit unions, usually you will need to pay a small fee and/or open a bank account with the credit union.

Did you know that credit unions are member-owned? Once you join, you become a member of the credit union, and this means that you’re also a partial owner. Taking the simple step(s) to become a member can open up your mortgage options, and many credit unions also offer their members the option to vote on important initiatives, like credit union board members.

Credit unions are also not-for-profit organizations, meaning they return their “profits” to their members in the form of lower fees and lower rates. Benefits vary by each credit union, so talk to your loan officer about what your credit union offers.

Credit union loan options

Credit unions have access to many of the same loan programs you can find with big banks or larger lenders. Since credit unions are owned by their members, they are more focused on customer service and providing step-by-step support, so many people find that getting a loan from a credit union is a much more personalized process.

Find out what type of credit union mortgage works for you

If you’re serious about buying a home, getting a pre-approval from your credit union is a great place to start. A pre-approval will give you in-depth insight into how much home you can afford and what your expected housing costs could be. For a refinance transaction, start a conversation with a credit union loan officer to discuss your financial goals.

Your loan officer will order a credit report and request documents from you.

Be prepared to provide several documents related to your employment and finances, which can include:

  • Tax returns
  • Pay-stubs
  • Bank statements
  • Documentation on your rental history
  • Gift fund documents (if you plan to use a gift to help finance the home)
  • And more!

If you are self-employed, it’s likely that you will need to provide additional documents to verify your income. Your loan options and mortgage guidelines could vary by credit union, but they will all have a similar list of documents they need to review to determine your eligibility.

Things that can determine which loan programs you qualify for:

  • Your debt-to-income ratio
  • Your income and employment history
  • Your down payment amount
  • Your credit score
  • Whether or not you’ve served in the military

It’s important to note that sometimes credit unions can offer flexibility not found with big banks, so it’s always smart to shop around for your home loan options before you commit to a lender. After conducting an analysis of your financial and employment background, your loan officer will recommend a loan program.

The credit union mortgage process

After you decide to move forward with a loan program, you may be asked for additional documentation. The loan officer will order an appraisal on the house to determine its value and make sure it’s worth what you’re paying, and then the loan will move to underwriting to ensure that your loan application fits the program guidelines. After these steps are complete and finalized, you’re ready to close!

Long-term benefits of a credit union mortgage

Working with a credit union doesn’t just benefit you during the loan process – there can be long-term benefits too!

One important benefit is that many credit unions keep their mortgages instead of selling them to a new servicer after closing. While selling loans is common in the lending industry since it allows lenders to free up money to lend to new home buyers, many credit unions prefer to keep the loans. This enhances the long-term relationship between the customer and the credit union.

Here are just a few more reasons why a credit union mortgage is a great option.

  • Ability to manage your financial accounts in one place
  • Maintain a long-term relationship with your credit union
  • Ongoing personalized service from financial and home loan advisors

Talk to our team at Bellco Home Loans today if you want to learn more about our mortgage offerings. Whether you want to purchase or refinance, we would love to talk about how we can support your home ownership goals.

Who is Bellco Home Loans?

Bellco Home Loans is a collaboration between Bellco Credit Union and Cherry Creek Mortgage, an independent mortgage lender that’s been helping families attain home ownership for over 30 years. Bellco Home Loans was born from a desire to provide a premier mortgage experience for Bellco’s members by partnering with a leading, locally-owned mortgage company with an established reputation in the community.

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