What is a Credit Union Service Organization (CUSO)?

  • February 3, 2021

While many might be familiar with credit unions and their purpose, most are not as aware of Credit Union Service Organizations (CUSO), despite there being almost 1000 CUSOs nationwide. CUSOs have been around for decades and while their services are typically specific in nature, their reach and customer base can be widespread.

Keep reading to learn the answer to “What is a CUSO?”, the benefits of partnering with a CUSO and more.

What to Know About Credit Union Service Organizations

What is a CUSO?

Credit Union Service Organizations (CUSO) operate as back-end, profit centers for credit unions to help them pool resources and reduce service costs. CUSOs must have at least one credit union owner and most CUSOs have a specialty, such as auto loans, technology resources, commercial lending or consulting services.

As of 2018, most of the CUSOs registered with the National Credit Union Association, had some sort of relationship with lending. And instead of only have one option or credit union to choose from, a member could have multiple choices through a CUSO relationship.

For member business-lending CUSOs, they often manage the servicing of a business loan from the start of a project until its end. For a full list of services and activities that CUSOs manage on behalf of their clients, consult the Legal Information Institute’s helpful page on this subject, including all activities that a credit union service organization can legally partake in.

Benefits of a Partnering With a CUSO

Let’s look at commercial real estate loans and the role the CUSO can play for both a borrower and a credit union. Many investors do not think of the credit union industry when seeking commercial real estate loans, often missing an alternative source of financing. Likewise, credit unions often do not have the ability to absorb and lend on a commercial real estate project solely due to the size of the loan opportunity. This is when a CUSO specializing in commercial real estate can help. The CUSO can provide the expertise related to onboarding, underwriting, participating and servicing the opportunity on behalf of the credit union, allowing the credit union the opportunity to invest while diversifying the risk.

Interested parties looking for a specific CUSOs can search a secure government database for registered credit union service organizations.

CUSOs allow borrowers to invest with flexibility as they put money back into their communities. They make refinancing existing loans easier to manage and ensure ideal outcomes for those real estate investors who demand nothing but excellence from their financial partners.

Find a Fitting Financial Solution

Ready to obtain financial peace of mind? You can find a fitting financial solution to your investment hurdles by contacting Extensia Financial, which has an established history of helping borrowers achieve their commercial goals on-time and under-budget. Investors can rest assured that Extensia has extensive financial backing and years of expertise it can leverage to ensure the success of a project; AVANA is a majority stakeholder of Extensia, whose state-of-the-art website is ready to help borrowers and lenders alike.