Back in March, we challenged you to re-look at your plan for growing
your mortgage portfolio. If you've developed a plan by now…
great, you're ahead of the game! If not, there's still time to formulate
a growth plan and implement it right now. With rates dropping even
further over the last three months, credit unions have been forced
to explore all of their options in order to keep up with the growing
demand for mortgages. Keeping up with the high demand is one problem.
The other question to address is ''What about when rates go
up and the market slows down?'' With that in mind, let's look
at 3 keys for mortgage lending success in any market.
Key #1: Marketing
As with any of your programs, mortgage lending will not be successful
unless you market it properly. Effective marketing starts with two
questions - (1) What about this program will interest my members?
and (2) How can I convey these benefits in a meaningful and cost-effective
The most obvious reason your members will be interested in your
mortgage program is to save them money. With rates at record lows,
you will be one of thousands of companies that can give your members
a great rate, and one of several they will shop. So, what other
factors besides price can you compete on? Service and convenience
would be the next issue to drive home to your members. Let them
know that you not only offer great rates, but exceptional service.
If you have extended or weekend hours, make sure your members know
about it. Your availability alone can make you more competitive.
If your members know they have a choice between going to a mortgage
company (where they don't have a relationship) or using their credit
union (where they already do their business), a good percentage
of members will at least check out the their credit union for their
mortgage needs. It would be a huge misfortune to have a great product
with great member service and not to let anyone know about it.
Second, in order to convey your message to your members, analyze
your marketing mix to see what's working the best. For some credit
unions, a radio advertisement can bring in loads of business. For
others, having tellers passing out flyers will do the trick. The
bottom line - it's important to get your message out at multiple
levels with consistent frequency. Here's a list of ideas and locations
for your messages to help you get started:
- On-Hold Message
- Statement Stuffers
- ATM Receipts
- Teller Buttons
- Lobby Posters
- Newspaper Ads
- Postcard Mailers
- Relationships With Real Estate Agents
Key #2: Finding the Right Partner
The next step towards competing effectively is to find a reliable
lending partner to help you serve your members' mortgage needs.
There are a variety of specialized mortgage companies in the marketplace.
You may need a full service partner to handle everything, or you
may just need someone to help with the application processing. The
key is to choose a partner that has the right mix of services to
meet your specific lending needs. For Tinker Federal Credit Union
(Oklahoma City, OK), they needed a partner that could help them
process their mortgage loans and deliver them up to the point of
closing. Troy Martens, Mortgage Manager at Tinker FCU states, ''Over
the last two years we've averaged between 30%-35% growth in our
mortgage business. By partnering with LSI we have been able to handle
the influx of mortgage business that has accompanied the low rates.
Outsourcing part or all of their processing functions is definitely
an option credit unions should reflect on when considering how to
handle increased loan volumes''. Research to find a partner
that fits in with your credit union's culture and one that will
represent your credit union admirably when dealing with your members.
Key #3: It's All About Service
The third key, service, works hand-in-hand with the first two keys
and ties everything together. Great service can be your best marketing
tool, as it inevitably fuels the coveted ''word-of-mouth''
marketing. When you provide exceptional service to your members,
you are setting the stage to gain their business next time they
are in the market for a mortgage, as well as any other loan they
may need in the future. Additionally, chances increase that they
will tell someone about their positive experience and the credit
union could gain more business from referrals.
Second, in order to provide great service, you will need to find
a quality mortgage partner that offers excellent service. A great
litmus test is to look for a company that treats your members as
good as or better than you treat them yourself. When looking at
companies, be sure to visit their operation first-hand and observe
how they handle member interaction.
Your members expect better service at their credit union than they
do from their local mortgage broker, and it's your job to make sure
they get the great service they expect. Following these three keys
will help you handle the increased business while rates are low,
but will also give you the foundation necessary to succeed when
rates increase and the market cools down.
Get Started Now
If you're looking to jumpstart your existing mortgage program or
if you're looking for a way to start offering mortgages to your
members, there has never been a better time to explore the options
available to your credit union. To find out more about LSI's Mortgage
Lending Program, contact Dan Mathews at 888-LSI-NLPC (574-6572)
or e-mail firstname.lastname@example.org.
LSI can structure a customized program tailored to meet the unique
needs of your credit union and members, and help you manage a successful