How 1 $21 Million CU Is Delivering Online Loan Apps

It doesn't take a billion dollars in assets or a talented tech staff to deliver automated loan processing- including online origination and electronic documents. At least not for Health Care Family Credit Union.

The $21.6-million HCFCU sends instant decisions and clicks through a web-based home equity and consumer loan processing system courtesy of Lending Platform, via service bureau support from EDS.

"Internally, the best thing about the loan origination system is that I didn't need to deploy another server, maintain any software, or integrate other legacy systems" said Tim Stephens, president at Health Care Family. "I don't maintain a tech staff, so Lending Platform makes my life easier."

Health Care Family has used the platform for one year, according to Stephens.

Additionally, Lending Platform allows the 7,000-member CU to broaden its reach. "If you have a PC and a browser, then you can access the system from anywhere," Stephens continued.

Health Care Family frequently sets up shop at SEGs, such as nursing homes and hospitals. SEG employees can then complete applications online at work, for example.

Application data entered online is automatically integrated into the loan system. That made Lending Platform an instant hit with loan reps, Stephens said. "The MSRs are really selling because Lending Platform dumps the application right into the loan system. And it's fast."

Training was a cinch-the four-person lending department learned how to use the system by telephone in two one- hour conference calls. Lending Platform wasn't out of the small credit union's price range. "We were getting quotes for $25,000 and up from other vendors," Stephens explained.

The Lending Platform implementation came at less than 25 % of those quotes, he said.

The system beats Health Care Family's previous DOS- and Dot Matrix-based loan origination platform, according to Stephens. "Readability and scanabilty are much better.

"We were completing our home equity documents with a typewriter," he continued. "With Dot Matrix, we'd try to line up the form, and then end up throwing it in the shredder and starting over. With a laser printer, we don't waste forms anymore."

The browser-based, laser printer environment was another hit with employees, Stephens said. "Employees dumped the old DOS program and Matrix printing so fast. They were SO willing."

Stephens said that customization is not part of the Lending Platform package. "What you give up with this system is customization, say if you want a screen to look a certain way."

Of course, there are other considerations. Small credit unions will have to rethink bandwidth when pushing electronic loan documents over the Internet.

"If you're still on dial-up, forget it," said Stephens. "The first consideration is to secure high-speed, stable bandwidth. We're on T1."

Loan officers can deliver documents electronically to members via a secure document viewer, which EDS added to the loan origination system in January. EDS serves more than 2400 CU clients, 130 of which use modules of Lending Platform.

"Lending Platform is one of the better things that EDS has done," Stephens said.