'Bundled' Platform Gives Home Equity Loans A Kick Start
Home equity loans moved into fast-forward after a credit union here started shopping from a "bundled" platform of ancillary services.
United Heritage CU (UHCU) can now close loans as fast as state law permits, according to Keith Ruberg, loan operations supervisor at the $400-million CU.
"Members get anxious waiting for the state's 12-day cooling-off period to expire," Ruberg explained. "Once the cooling-off period expires, it's crucial that we have our ducks in a row and are ready to close. With the bundled platform, we are ready."
UHCU picks and chooses all of its valuations, floods, and titles from one bundled services website, Ruberg said. The bundled services, provided by Spokane, Wash.-based SharperLending, allows UHCU to order and manage ancillary products offered by hundreds of vendors.
Before the bundled services, 12 days wasn't always enough for the CU to close on a loan, especially when it came to appraisals. So now, UHCU bypasses manual appraisals, substituting them for automated valuations, which are delivered instantly, he said.
Flood determinations are also instant, whereas the CU used to wait up to 48 hours after a manual request. The platform requires UHCU to enter the member's loan data just once, instead of rekeying information for each separate product.
"We're trying to take the time and the risk out of the process it takes to lend to members," said Ted Robinson, director of marketing and sales at SharperLending.
Bundled products include appraisals, mortgage loan reports, automated valuation models, as well as credit reports, titles, flood determination and closing documents, said Robinson.
SharperLending estimates that CUs can save an average of 25 to 50 basis points per loan.
Indeed, UHCU is saving on costs and labor -savings the CU passes along to the member.
The CU has been able to keep closing costs steady, despite the fact that local recording costs have recently "dramatically" increased, Ruberg said.
And when the CU orders an automated valuation, it can save up to $300.
"After years of manually ordering separate reports for title and flood, the bundled services platform is creating efficiency," Ruberg explained. "The service is electronic, so we can point and click to get instant reports as well as valuation models. With the instant turn-around time on title, flood and valuation models, we can focus on processing more loans."
Previously, originations were a matter of "constant follow-up," he said. "We'd have to manually complete a separate request for each report, fax it and confirm that it was received."
With the bundled platform, UHCU tracks the status of all requests on the Web. "If we see that a report is pending, we can email for a reason as to why it's pending."
Although UHCU offers home equity lines of credit and home improvement loans, it has put most of its attention on home equity lending since 1998 because "it's more in demand with our members," said Ruberg. The portfolio stands at $350-million in loans outstanding, he said.
The CU recently introduced real estate products and will also process mortgage loans with the bundled platform, Ruberg said.
UHCU has used SharperLending for one year, via a partnership with San Antonio, Texas-based Southwest Business Corporation.
For info on this story:
* United Heritage CU at www.uhcu.org
* Sharper Lending at www.sharperlending.com
* Southwest Business Corporation at www.swbc.com