Take the time to get a holistic view of members’ circumstances and you’ll discover new opportunities and build deeper relationships.
That’s Elizabeth Million’s approach to mortgage lending. Million, vice president of mortgage lending for $1.5 billion asset Elevations Credit Union in Boulder, Colo., new regulations are restricting large financial institutions’ mortgage capacity—opening the door for community financial institutions such as credit unions.
She recently addressed pressing mortgage lending issues with Credit Union Magazine.
CU Mag: How is the mortgage application experience changing for consumers?
Million: On the whole, traditional lenders like the Big Four banks are leaving the mortgage lending space or restricting their lending capacity.
Today’s lenders are conducting more stringent due diligence on applicants. In turn, prospective homeowners need to jump through a few more hoops to identify the right lender and, more importantly, qualify for financing.
CU Mag: What’s driving this change?
Million: Dodd-Frank gave birth to the Consumer Financial Protection Bureau, and that organization has issued new regulations, like the “Know Before You Owe” and “Ability to Repay” rules.
Generally, these and other regulatory updates have instituted a new way of doing business in the mortgage world: lenders must review applicants more judiciously and clarify processes for consumers who wish to borrow from them.
Because these changes and new requirements have proved costlier, larger financial institutions have reduced or eliminated their mortgage lending capacity, opening the door for new businesses and community financial institutions to help consumers.
CU Mag: What are the benefits of these changes for Elevations CU?
Million: Ultimately, these changes create a great opportunity for us to better understand and serve our members.
As we work to build relationships with our members through our holistic approach to the lending application process, we’re able to accommodate consumers who may have ended up, for instance, on the wrong end of a short sale.
They may not, for instance, have a certain amount of cash on hand, but we have processes and committees to evaluate special circumstances and generate solutions that work for everyone.
Realtors and builders in our community love working with us because they trust that we’re connecting them with trustworthy consumers who have been well-vetted.
CU Mag: What challenges do these changes present for Elevations CU and other CUs?
Million: We’re always thinking about how we can create the best experience for our members and realtor and builder partners.
Balancing production and resources while maintaining great member service and relationships with those external partners continues to be our greatest challenge. As more members have sought our help, the mortgage division of our business has grown exponentially, from roughly 10 employees five years ago to more than 80 today.
Ensuring that we are properly staffed, and ensuring that our team is well-trained and well-equipped to serve the diverse needs of our growing member base, remain top priorities.
CU Mag: How has Elevations CU helped members navigate this new terrain?
Million: The thing that sets Elevations’ mortgage team apart is our holistic approach to the application process.
We don’t just look at a scorecard of credit history and other analytics. We take time to learn about our members’ unique circumstances and goals.
We think of these opportunities as people underwriting people—not systems underwriting statistics.
We’ve also instituted distribution of a weekly communication to all members and realtor partners, helping both sides stay updated on developments impacting their transactions and opportunities.
Beyond these processes and philosophies, thanks to the support of our senior leaders, we have grown our specialized staff and deepened our commitment to their training and support.
We prioritize loan officer assistance, and those support teams perform some of the most important functions in our workflows. This support ensures that every mortgage case is appropriately resourced.
In turn, our team has continually improved its service to our members.
CU Mag: What effect have these new processes had on your mortgage business?
Million: We’ve received humbling recognition throughout the Boulder community and state of Colorado since committing to our mortgage program five years ago.
Having processed more than $1 billion in mortgages in 2015, we are now the top credit union mortgage lender in Colorado. In terms of local market share, we now service four out of 10 mortgages in Boulder County and have been the top mortgage lender in Boulder County for more than four years.
And readers of local publications, like the Boulder Daily Camera, have also voted us “Best Mortgage Lender” in our community.
CU Mag: What advice would you offer other CU mortgage lenders?
Million: At Elevations, our team has been very fortunate to receive full backing from our senior leaders.
They understand the importance of helping us connect with our members in this way, and as we’ve presented new ideas for growth, they’ve responded with the tools and resources to expand. Seeking top-to-bottom support and buy-in is crucial for any new business segment expansion.
It’s also critical to go beyond the scorecard and really understand your members and applicants. If you’re just looking at a credit score and other analytics, you’re doing your members a disservice.
Take the time to get a holistic view of their circumstances, and you’ll discover new opportunities and build deeper relationships.
Bill Merrick is deputy editor of Credit Union Magazine. Follow him on Twitter via @CUMagazine.