Guest: Erik Harwood

Credit union lending strategies take center stage as host Mark Ritter of Credit Union Conversations welcomes Erik Harwood from Sun East Federal Credit Union. Erik shares insights on navigating today’s commercial lending landscape and adapting to the normalized liquidity management environment of 2025. The conversation explores innovative residential mortgage lending programs, including Sun East’s pioneering 40-year fixed-rate mortgage programs for credit unions that address affordability challenges. Erik discusses loan portfolio growth tactics, pricing approaches in fluctuating interest rate environments, and the evolution of credit union lending strategies in competitive markets. 

IN THIS EPISODE:

  • (00:00) Intro: Meet Erik Harwood from Sun East Federal Credit Union
  • (03:30) The differences between community banks, large banks, and the local credit union, mainly focusing on commercial lending
  • (11:06) Erik explains liquidity management challenges and discusses loan portfolio growth 
  • (12:58) Discussion of loan pricing strategies using the “three door” philosophy, car loans and interest rates
  • (18:18) Erik details their residential mortgage lending programs, including the 40-year fixed-rate mortgage programs for credit unions 
  • (21:42) Discussion of business loan programs, treasury management services, business loan caps, and opportunities in real estate lending

KEY TAKEAWAYS:

  • Credit union lending strategies are normalizing in 2025 after years of extreme liquidity management challenges, with institutions finding a balance between deposit costs and lending opportunities while utilizing borrowed funds strategically for loan portfolio growth.
  • Sun East’s innovative 40-year fixed rate mortgage programs for credit unions priced at parity with 30-year terms provide $220-$250 monthly payment relief, helping borrowers overcome debt-to-income ratios barriers while maintaining substantial risk mitigation through minimum credit scores and maximum LTV requirements.
  • The interest rate environment remains unpredictable, with treasury bond yields not correlating to federal funds rate cuts as expected, requiring lenders to adapt loan pricing strategies based on cost of funds rather than traditional Fannie Mae floating rates.communities.

RESOURCE LINKS:

Mark Ritter Website
Mark Ritter – LinkedIn
Sun East Federal Credit Union
Erik Harwood – LinkedIn

Mark Ritter is the CEO of MBFS and an expert in credit unions and business lending. His primary role at MBFS is overseeing the strategy of helping credit unions assist members with business needs and consulting with credit unions on planning the delivery of services to their membership.