State Employees’ Credit Union Mortgage Reviews

State Employees’ Credit Union is recommended for qualifying members looking for homes in one of the five states where they can mortgage a property. It may also be a great fit for first-time homebuyers or low-to-moderate income buyers, thanks to its first-time homebuyer programs, 100% mortgage loan financing and lack of private mortgage insurance (PMI) on loans.

However, first-time homebuyers looking to secure a Federal Housing Association (FHA) loan won’t find one with SECU, although SECU’s loan terms may be better than those of an FHA. The company’s mortgage loans are also only available to its members, so a different company is a better fit if you don’t qualify for membership.

You can only take a mortgage with State Employees’ Credit Union if you’re a member. In general, you’ll need to be a North Carolina state employee, such as an employee of Social Services or Civil Defense of North Carolina counties. Federal employees assigned to a North Carolina agency are also eligible.

Other qualifying groups include immediate family members, unmarried widows of people who passed away while working a qualifying job or people living in the same residence as a current member.

Once you’re a member, you can apply for a loan online through SECU’s secure mortgage application process, by phone through Member Services (888-732-8562) or by visiting a local branch.

When making a loan decision, your loan officer will look at your ability to repay the loan, credit history and the value of the home. They’ll evaluate factors like your:

• Gross income and additional income sources
• Debt-to-income ratio (should not be more than 43%)
• Monthly debts, such as mortgage or rent payments, auto loans and credit card debts
• Past performance on loans with SECU and other companies
• Loan-to-value ratio (how much the house is worth vs. how much you’re borrowing)

State Employees’ Credit Union only offers conventional mortgage loans, mortgage loan refinancing and a home equity line of credit. Its unique loan features and flexibility make the loans suitable for most homebuyers.

For example, SECU offers 100% financing, no private mortgage insurance and no application fees on most, if not all, of its loans. Here’s what else makes their loans stand out:

• Five-year adjustable-rate mortgage (ARM): Interest rate can only be adjusted every five years. It also can’t change more than 2% at adjustment or 6% over your initial interest rate over the loan’s life. You can have a maximum term of 30 years. This mortgage can be used with traditional homes, manufactured homes, first homes and historic preservation homes.
• Fixed-rate mortgage: 10-, 15-, 20- and 30-year terms available.

SECU also helps make first-time homebuying easier for eligible members with:

• $2,000 in closing costs with 100% financing through an ARM
• $12,500 toward down payment and closing-cost assistance through the Federal Home Loan Bank of Atlanta (FHLBA)
• A federal income tax credit of up to 30% of the mortgage interest payment (up to $2,000 annually) for the life of the loan by participating in the NC Home Advantage Tax Credit. The mortgage credit certificate is only available for North Carolina properties and is also open to military veterans and members buying homes in certain areas.

If you go through with an SECU mortgage and later experience financial hardship, the company offers a Mortgage Assistance Program (MAP). It may be able to temporarily lower mortgage payment amounts, defer payments or modify or refinance your loan’s terms.

State Employees’ Credit Union starting mortgage interest rates range between 5.425% and 6.875% for its fixed and adjustable-rate mortgage (ARM) as of this writing. Home equity lines of credit (HELOCs) are available with starting APRs of 7.50%.

SECU is very transparent about its rates, posting the lowest rates for each type of loan on its loan product and “Lending Rates” pages. Your specific rate depends on your creditworthiness, borrowing and downpayment amounts and other financial factors.

According to the Consumer Finance Protection Bureau, most lenders surveyed in North Carolina offer rates between 6.500% and 8.125% for borrowers with good credit, making SECU’s mortgage rates lower than many.

SECU charges a 1% loan origination fee, with a cap of $2,500. There are no application or credit report fees. Other fees homebuyers can expect to pay outside of SECU’s services but as part of their closing costs include:

• Appraisal fees
• Tax service provider fees
• Title insurance
• Government taxes
• Prepaid expenses (property taxes, homeowners insurance, interest until first payment is due)

State Employees’ Credit Union mortgages are only available to a limited group of people, and it only offers a few types of loans for properties in a handful of states. Here’s how they compare to other popular mortgage lenders.

Yes, State Employees’ Credit Union is a legitimate financial institution that’s federally insured and state-chartered. It’s been around since 1937 and serves 2.7 million members. SECU is North Carolina’s largest credit union, with $50 billion in assets and 274 branches.