How Credit Unions Can Improve Their Mortgage Lending Process & Get More Business

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How Credit Unions Can Improve Their Mortgage Lending Process & Get More Business

October 18, 2024
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Certified Credit

While 2024’s challenging market conditions have been difficult for many financial institutions, credit unions have been hit the hardest. Credit unions faced a 31% decrease in lending since the second quarter of 2022, compared to banks’ more modest dip of 11%. 

Fortunately, brighter times are on the horizon. Thanks to the Federal Reserve’s recent rate cut, housing inventory and mortgage affordability should increase soon, spurring a much-needed uptick in mortgage applications. 

If you run a credit union, you may be wondering how to optimize your mortgage lending workflows to attract more business. Below, we’ll offer six steps and several solutions to streamline this process. 

Step #1: Digitize Your Mortgage Applications 

While most borrowers (60%) prefer an online application process, these tech-savvy sentiments are strongest among younger demographics. Unfortunately, millennials and Gen Zs are also the least likely to choose credit unions for their banking needs – studies show that as few as 4% of Gen Z and 5% of millennials regularly use credit unions. 

If you want to appeal to these burgeoning homebuyers, digitizing your mortgage applications is a must. You can do so with ease with Cascade Prequal. This automated solution compares applicants’ credit data with your pre-set eligibility thresholds and delivers them instant responses. Some other benefits of Cascade Prequal include:

  • Easy integrations – Cascade Prequal can integrate with your website and loan origination system (LOS), enabling you to review applicants’ data and follow up with them with ease.
  • Soft pull credit reports – Since Cascade Prequal uses soft pull credit reports, it won’t impact your applicants’ credit scores or trigger competitors’ lead alerts.
  • Customizable settings – You can configure Cascade Prequal to use one, two, or three bureau reports, depending on your needs and budget. 

Step #2: Reach Out to Mortgage-Minded Members at The Right Times

While offering prequalification is an effective way to attract new leads, valuable opportunities also exist within your current member base. You just need a reliable way to identify and qualify them. Cascade Alerts can help facilitate this process. 

This automated credit monitoring tool scans your members’ credit activity for signs that they may be seeking a new mortgage product. After that, it alerts you within 24 hours so you can reach out and remind them about your competitive mortgage loan offerings. You can customize your eligibility criteria so you only receive alerts for qualified leads. 

Here are a few reasons why Cascade Alerts is an ideal solution for growth-minded credit unions:

  • Cascade Alerts aligns with credit unions’ core values – Credit unions stand out for their personalized service and tailored support. By pitching personalized mortgage products to your members who are in the market, Cascade Alerts can help you win their repeat business.
  • Cascade Alerts fosters member retention – As not-for-profit institutions, credit unions value their members for more than just their financial contributions. Every member represents a meaningful investment in the organization’s mission and longevity. You can maintain your members’ loyalty by delivering them Cascade Alerts’ timely offers.
  • Cascade Alerts can free up your time to focus on relationship building – Attracting and qualifying leads manually can take up a lot of time. By automating these tasks, Cascade Alerts can free up your schedule so you can spend more time focusing on your members.

Step #3: Offer Customized Credit Score Improvement Suggestions

Along with superior customer support, many people choose credit unions for their financial education and personalized advice. One area where your members could use some extra support is with their credit scores. After all, 50% of Americans who have applied for financing this year have been denied.

Rather than rejecting your members who don’t qualify for mortgage loans, consider nurturing their creditworthiness with ScoreNavigator’s solutions. This advanced credit management platform enables you to generate personalized, data-driven steps to strengthen members’ credit scores.

ScoreNavigator’s Mortgage Action Plan (MAP) can highlight which credit accounts require the most immediate attention, while its proprietary Point Deduction Technology® can estimate how many points each credit account adds or detracts from their overall score. The ScoreNavigator platform also features several innovative simulators, which can:

  • Predict the impact of various credit decisions.
  • Determine which accounts to pay down first to achieve the greatest score improvement. 
  • Generate custom action plans to achieve specific credit scores. 
  • Highlight the best day of the month to pull applicants’ formal credit reports. 

By mapping out the fastest path toward mortgage loan approval, ScoreNavigator can make you an invaluable asset to your credit union members. Better yet, it can help you transform more non-qualifying applicants into loyal, revenue-generating borrowers. 

Step #4: Honor Your Member’s Data Privacy With Consumer Permission Data

Did you know that two-thirds of consumers believe that companies have too much control over their data? This sentiment has inspired a rise in consumer permission data (CPD), which is information that your members voluntarily share with you.

CPD has become a popular verification of income and employment (VOE) method. With this method, your members authorize access to their payroll data directly so you don’t have to purchase it from a third-party database or request it from their employers. Along with showing your members that you value their data privacy, CPD is:

  • Fast – With Certified Credit’s CPD solution, your members can share their financial data securely in a few clicks.
  • Frictionless – By eliminating unnecessary paperwork and lengthy turnaround times, CPD can facilitate seamless verifications.
  • Affordable – CPD VOEs are often much more cost-effective than their instant-hit or manual counterparts.
  • Inclusive – CPD can help you verify applicants who may not be featured in traditional payroll databases due to being gig workers, independent contractors, or government employees. 

You can experience the benefits of CPD with Cascade VOE. This automated VOE solution integrates with Experian Verify Consumer Permission Data, along with several major instant-hit providers. After selecting your list of preferred vendors, you can arrange them strategically in a custom cascade. Cascade VOE will then cycle through these vendors according to your specifications.

If Cascade VOE doesn’t return a hit for a specific member, Certified Credit’s super-fast manual VOE team can take over the process. Over half of our manual VOEs are completed in less than two days.

Step #5: Choose Scalable Solutions that Integrate with Your Existing Systems

Automated mortgage lending solutions can enhance your efficiencies, expedite your loan originations, and increase your members’ satisfaction. However, not all mortgage technology is created the same. The best solutions should scale with your business and integrate seamlessly with your existing loan origination system (LOS):

  • Scalability – Many credit unions invest in mortgage lending technology in hopes of attracting more business. As such, they need solutions that can scale with an ever-expanding member base. At Certified Credit, we design all of our solutions with scalability in mind. Our Cascade Automation, in particular, can help you process an influx of applicants while ensuring you have enough time to deliver exceptional customer service.
  • Seamless integrations – If you’re like 60% of credit unions, you use MeridianLink Mortgage’s LOS. This comprehensive platform features powerful automation, detailed analytics, and a marketplace of vendor integrations. We’re excited to announce that Certified Credit and MeridianLink recently partnered up to provide our customers with a more convenient integration experience. If you don’t use MeridianLink, don’t worry – our solutions integrate with several other LOS providers, as well. 

Investing in technology that checks off these two boxes can set you up for success and save you money down the line. 

Step #6: Work With a Vendor Partner That Shares Your Credit Union’s Values

While cutting-edge technology is crucial, having a reliable customer support team is equally important. You never know when troubleshooting issues or use case questions may arise. A dedicated customer support team can onboard your employees, provide comprehensive training, and ensure your solutions remain up and running at all times. 

At Certified Credit, we provide this type of customer support at every stage, earning us The Mortgage Collaborative’s 2024 Lender’s Choice Award for Best Customer Service. Like your credit union, we value our clients and are fiercely committed to their success. 

Here are a few statistics that demonstrate our dedication to our mortgage lending clients:

  • Our Customer Success team is 100% onshore and staffed with FCRA-certified experts.
  • We answer 95% of our customer service calls within 30 seconds or less. 
  • We have a 12-second speed of answer (ASA) for all inbound customer inquiries. 
  • 30% of our customer support staff is bilingual. 

Optimize Your Credit Union’s Mortgage Lending Process With Certified Credit

With the right tactics and technology, you can elevate your workflows and eclipse more business from big-bank competitors. The first step? Upgrading your tech stack with Certified Credit’s solutions. 

From Cascade Prequal to ScoreNavigator, our tech tools can help you cut costs, speed up loan originations, and enhance your members’ experience as you pursue ambitious growth initiatives. Along with these solutions, we also offer:

Ready to learn how Certified Credit can help grow your credit union’s mortgage lending business this year? Schedule a credit consultation with our team today.

Sources:

America’s Credit Unions. Mastering Lending Challenges: Strategies for Credit Union Success.

https://media.americascreditunions.org/articles/123547-mastering-lending-challenges-strategies-for-credit-union-success

McKinsey & Company. Competing on customer experience in US mortgage.

https://www.mckinsey.com/industries/financial-services/our-insights/banking-matters/competing-on-customer-experience-in-us-mortgage

The Financial Brand. Why Credit Unions Are Primed to Revolutionize Financial Services in the U.S.

https://thefinancialbrand.com/news/bank-marketing/personalization/why-credit-unions-are-primed-to-revolutionize-financial-services-in-the-u-s-175887/

Bankrate. Denied and distressed: Half of applicants have been turned down for a loan or financial product since the Fed began raising rates.

https://www.bankrate.com/credit-cards/news/credit-denials-survey/

Exploding Topics. 23+ Alarming Data Privacy Statistics For 2024.

https://explodingtopics.com/blog/data-privacy-stats