When it comes to lending decisions, credit unions need to take more into account than just a member’s credit score, says Michael Cochrum, executive lending advisor with CU Direct.
That’s a shift in thinking from the way credit union lenders have operated in the past, but it’s a shift credit unions show consider making in order to survive, thrive, and grow their lending portfolio in the future.
“We are at a moment in time in credit union land where we have to make a decision,” says Cochrum, who spoke during a breakout session at the CUNA Lending Council Conference in Las Vegas. “Do we want to be different? Do we want to be what our members want?”
To be what members want, credit unions will have to change how they approach making lending decisions. To start, Cochrum said a few myths that need to be addressed:
In order to take full advantage of the data available to credit unions and how it can be used to make changes in its lending process, Cochrum said there are three things credit unions should do in the next 12 to 18 months:
“If you have a passion for your credit union, in order to survive, these are the things you must do,” Cochrum said.